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Thread: How Much Does it Cost to Build An iPhone 4S?

  1. #21
    My iPhone is a Part of Me
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    Almost every major label smartphone out there right now retails, without subsidy, at or more than $600. Nexus series sells $500+ no-contract, most first-run HTC devices sell for 600-700, and Nokia sells their newer N-Series phones unlocked for at least $500. Do you think they don't have high profit margins?

    That's just how it is.
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  2. #22
    Quote Originally Posted by dennder View Post
    Too true to be heard by apple-haters, however, in the sight of apple's quarterly reports this company does sell these devices priced with huge margins, just not that huge as would this article suggest.
    And, you forget that these parts are static costs (or those that vary very little because quantities produces are enormous already). All the staff wages and other costs to run the enterprise are being diminished with each device sold, since the more devices there are, the more profit from each additional one sold is being earned, don't you agree?

    While that is true, Apple is still growing as a company. So in reality, a fixed price model wouldn't work. The more they sell, the more stores they will have to open, as well as everything else that goes with opening new stores. It could be international stores, it could be new overseas HQs. So while the more they sell will turn up larger margins, sooner or later they will have to dip back into that cash to continue expanding.
    I'd rather be on two wheels.



  3. #23
    Livin the iPhone Life
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    Don't kid yourselves guys. Apple is making a killing off of iPhones since introduction, and they still are making a killing now.If it were not for the iPhones I would not own an Apple product.

  4. #24
    All the money is in the service not the phone

  5. #25
    Quote Originally Posted by markydias View Post
    I wish there was a rating system for these comments. I would definitely +1 this man right here.
    Only one correction. I am an Apple share holder. They do not pay dividends (the last time they paid dividends was in 1995). Other than that +1 from me as well.

  6. #26
    [QUOTE]So Apple can build a 64GB iPhone 4S for 70% less than you pay for the unlocked version. That's a huge margin.[QUOTE]

    In other words, Steve Jobs (as sole Apple employee) sat in his Cupertino office, whipped up a sketch of the i4S, sent it to the factories in China, and then waited for the 70% profit margin roll in.

    The reality is that Apple needs to spend a lot of money on people doing R&D for hardware and software, plus overheads for sales, marketing, regulatory compliance, IT support, HR, legal, etc etc.

    I'm sure Apple make a healthy margin on their products, but it would be nowhere near the size claimed by the absurdly simplistic analysis in this article.

  7. #27
    Green Apple
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    Quote Originally Posted by realisticmind1 View Post
    Right, but he is also talking about the actual Apple employees. Apple has to make enough on their devices to be able to cover all of the corporate salaries, benefits, taxes and everything else that goes with employing high caliber professionals. Not to mention, it also has to cover the expenses of each and every Apple store and employee working there as well.

    It may cost $8/unit for the factories in china to put out a single device, but that does not factor in everyone who actually works at Apple.



    I'm pretty sure the Apple retail employees are making way more than minimum wage...

    And don't forget the engineers. How much do you think they are paid? Or the money going to Tim Cook and the rest of the board? How about just the admins and in house HR employees? The legal team? How about the amount of money going to the share holders in dividends? The cost of actually owning\renting the buildings all these employees work in? You aren't looking at the whole picture.
    bro, what dividends?

    Quote Originally Posted by Dranon View Post
    OK but selling these at retail also means the STORE has to make a profit! Whether the Apple store or the cell phone store. ATT, Verizon, Sprint etc. I wonder how much margin is there?? I know they subsidize on contract but I wonder how much does the store have to buy them for from Apple? AND how much is the subsidy on these? Like when does ATT see profit on a contract after the subsidy? 2 months 6 months a year??
    Apple stores are part of apple co.............doh! DX
    Last edited by bstunt10190; 10-20-2011 at 11:50 PM.

  8. #28
    you guys forgot to talk about the App store, that's where Apple are making the real $$$$$

  9. #29
    iPhone? More like MyPhone smuggler's Avatar
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    i want to buy a couple of the individual parts and and install them into my iPhone 4 to make it an iPhone 4s. that would be awesome.

  10. #30
    Quote Originally Posted by Poseidon79 View Post
    CNET reported that it costs an estimated $8 per unit to assemble.
    Yeah, why no one ever mention about the R&D cost ??

    How about cost of putting product through tests & regulatory? Cost of building iOS? Cost of Legal matters? Cost of Marketing? Cost of PR?

    The BOM cost is useless if you don't factor all the other intangible cost.

  11. #31
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    These are additional points that I have not seen being mentioned so far.
    Apple also has to invest in servers and their maintenance which are being used by iCloud and Siri. Plus they need to keep a certain stock of "replacement" iPhones, certainly at the beginning, as later on they have enough faulty ones to build new "replacement" ones.

  12. #32
    iPhone? More like MyPhone Dranon's Avatar
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    Quote Originally Posted by bstunt10190 View Post
    bro, what dividends?



    Apple stores are part of apple co.............doh! DX
    AND as you NOT so clearly saw I stated that the store that sells the iphone ANY store not just Apple store! So you sir must be one of these idiots I keep hearing about

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