The New iPhone 6S Costs Just $234 to Make, Sells for $749

While it is an accepted convention that your favorite Smartphones are not as expensive to make as their makers seem to indicate all the time, the profit they make from them is always an astonishing thing to hear.

The latest such news comes from Business Insider which has assessed the components that make up the new iPhone 6S. According to their calculation, the best-selling smartphone over the next year will cost Apple a measly $234 to make.

The version, if you are wondering was the 64 GB one. Meanwhile, the base model starts at a staggering $749 with just 1/4th the storage, meaning Apple takes home more than $515 at least is gross profits from every single of these phones it sells.

Its new landmark feature, 3D Touch, as it turns out, doesn’t cost quite as much to make; the display, camera and battery combined cost just $73.

unnamedThe semiconductors bit takes the major chunk at $127. $25 out of those is for that blazing A9 chip, $20 for the 64 GB storage chip, $22 for the fingerprint, NFC and other sensors, while $36 is reserved for the cellular radios.

The phone also takes a new aluminum case after the issues with the last models, but that too costs $33. Other costs including R&D and distribution overheads aren’t included, obviously.

Now of course, this isn’t a surprise that the phone costs more than the model which it replaces by $28.2, the sales records which are created each year means that Apple won’t really mind. (This year too the estimate is set at 10 million in pre-orders alone).

Of course, for the price you get a phone with the best optimization, one of the best performance in a handheld and the best 3rd party support perhaps for any device ever, it is a lot to ask for a phone which will be replaced in less than a year after its release. At least it won’t be a slouch, as things indicate, after that time period.

  • Not an iPhone fan; never owned the device … but the misleading “taking home $515 profit” claimants must know that there is a f$%*g thing called Research and Development. Also, would you buy an iPhone without software?

    • Yeah, that’s why 3rd world always as called Jahil-Gawar. We never invest in Research & Development therefore we couldn’t estimate its cost and put things on blogs on bias.

      Poor executed article by PROPAKISTANI :(

    • Apple sells MILLIONS of iPhones each time. Even if you take a 100$ for R&D and 2 million iPhones sold, it gives you $200 mn for R&D for each iPhone version, and $415 profit per iPhone.

      • You’re kidding right? Or is that some idiotic Apple hate talking? Things are never as cut and dry as “$100 for R&D per iPhone and 2 million iPhones sold”, this isn’t some math class where you go buy 2 million watermelons for $100 each then sell them each for x profit and you have to calculate the total profit.

        Apple R&D budget is a lot more than even 200 million. Besides, R&D isn’t the only thing factored into cost. Apple has excellent software support and all their devices get software updates for at least 4 years. Do you think people who make those software updates work for free? They make arguably the best mobile OS there is, in terms of simplicity and usability. What about marketing and labor costs? Marketing costs alone are much more than 200 million. And those are only the obvious ones. I’m not saying that they aren’t making a sizable profit, but it’s nowhere near what you think, in the perfect little world you’ve created in your mind.

        • Continuing your comment, Haider bhai is also completely forgetting that component cost is not equal to manufacturing and assembly cost, which, again, doesn’t happen for free. Then, there’s factory overheads, advertisement costs, distribution costs and customer support that do not happen for free.

          What disappoints me in particular is how the writer made this claim in the first place. Several sources reported this estimate – I wrote the piece on RedmondPie myself – but no one made the deduction that this translated to $515 in profits. Azeem, I hope you’d be more careful in the future.

          • Continuing again, Haider if know some little maths n you can calculate the cost claim for each set is equal to “manufactured by CHINA” for any cheap local supplier. All the R&D was already done by those blood/kidney sucker INNOVATORS.

            So please next time defend those things which have some concrete evidence or have something logical. Otherwise people will say “woh dekho aadhey dimaag wale Haider bhai aaye hain”

  • That is just the production cost. I can’t imagine the level of stupidity one has to be at, to think that all of the rest is profit.

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