Apple’s iPhone 5 16GB costs approximately $168USD to build


  • Darth Paton

    No wonder they are the most profitable company in the world, their products are almost pure profit! Take mediocre hardware, convince people its high quality, and then shaft them with a price that higher then anything else = huge profits

    • ruddias

      Wait wait wait. So they increased the screen size, resolution, processor, and RAM, but DECREASED the battery size by 20mAh?!

    • BB

      Can you imagine how cheap it is for them to make a mac book…???? they are probably making 1500 profit on one of those….lets not even start about the 10 gen ipods..oh ya lets add on apple insurance too…if you break it they will cover you for the price…pretty genius when they know its going to break!!!


      Exactly what I’ve been saying man. This is why crApple is pissed @ suing because Samsung is selling (in crApples own words) the exact same device for half to a third of the price of crApples iPhone & exposing their greed. So in other words crApple has told their customers they are ripping them off selling them what they call a high end device but is outdated or mid-range technology for the price Samsung is selling its actual top of the line technology that is twice as powerful. There are many crApple customers that see this & have called bullsh*t & are making the change & I have yet to see anyone who made the switch to a Galaxy S3 or Galaxy Note that have any regrets. There seems to be many that have their heads up their butts just as far as crApple that still can’t see the light though & I feel bad for these as I call them complete morons, and sorry but you must be to buy from a company that tells you themselves that they are ripping you off. Since ppl only seem to be making the switch from crApple to Android & not the other way then I think the iPhone 5 is not going to come close to expected sales. Many iPhone users are waiting to get their hands on the Galaxy Note 2 & I really believe this will be the top seller of 2012 & maybe even all time. – KID ANDROID ( TEAM.ANDROID.CANADA)

  • superfly

    I puked

  • nrj4life

    Too greedy to put products on sale or give discounts and too selfish give to charity. They spew how much they have and what to do with it, choosing to waste on trying to silence those who have smoked them in innovation instead of actually considering those in need. One day life will give them a slap they won’t forget.

    • jonny

      jobs did die of cancer at a pretty young age.

      toxic person, his body turned on him.

      i wonder if he thinks it was worth it.
      was he even happy? he never looked happy.

  • ImTherious

    *Baaaa*, where’s the line-up, *baaaaa*

  • Vengefulspirit99

    I am not surprised

  • staeit

    These charts don’t take into consideration the R&D, the design phase, the amalgamation of software and hardware, the exhaustive testing, not to mention the running costs of hiring thousands of employees, and running a bunch of services. I remember reading awhile back that iTunes is being run at a loss (obviously largely offset by the immense profits Apple takes in each quarter).

    If just anybody could make a device for $168 and sell 10’s of millions for $700+, we’d all be doing it. It’s obviously hugely profitable. Apple has created an ecosystem, and the gateway to this ecosystem is their devices.

    • Martin

      Apple’s R&D spending in ratio to its revenue has actually been falling over the years. It spends less than 3% of its revenue on R&D.

      In absolute numbers, yes it’s growing.

    • Sid

      I wonder how much of that profit went into R&D/new technology/proving services, how much went into the pocket of executives and share holders, how much went into lobbying the government…

      An example of the greediness is the MFi program. Do you know how much they charge someone who wants to build a simple iOS accessory? It makes me sick.

      Poor iSheep, being raped and still defending it…

    • Sid

      Apple’s R&D spending is estimated to be around 2.2% of revenue last year. And that is an over-estimation. So really it is about <1.5%. Pathetic.

    • Jay

      Wait… Wait… Wait… Apple R&D? Are you serious? You know like 90% of the parts for the iPhone are outsourced from companies like Samsung, right? Apple hasn’t made their own product for a long time now, they rely on others to do it for them. Innovative? I think not.

  • Threecube

    It just amazes me that a 4 inch phone can cost $699 when a 7 inch tablet costs $249

    • Shannon

      Actually you can get a 7″ Tablet for $199 if you get the Nexus 7. I guess the companies that make these devices have a lower profit margin.

  • Rich

    Apple does so well because they invest in themselves — they are not “top dog” because of innovation or superior products, but because they are geniuses when it comes to marketing.

    Those marketing expenses, which are immense, are one of the main reasons why you’re shelling out so much for their products.

  • AR

    @staeit – That is why the analysis simply mentions “Bill of Materials”. Of course, there are numerous other costs involved in developing a product, as you have highlighted.

  • mike

    what amalgamation???? They stretched the screen and thats it.

  • crapple@316%markup

    Holy shite a 316% markup! Not enuff markup Crapple. Isheeps wont feel special enuff only paying that little of a markup.
    Muat pay more, baaaaaaaaaaa, baaaaaaaaaaa, baaaaaaaaaaa, lol!

  • IAK

    Slave labor, great marketing and massive markups, thats how you become the best.

  • briggs

    482$ in revenue sure. That said, Apple as incredibly intelligent in signing those long term contracts with vendors.

    I’d be curious to see this in a side by side with say, Samsung or Sony, companies that effectively make their own parts, and see what the divisions are charging each other.

  • superfly

    I puked again

  • Jason

    They are the oil ompany of tech…

    Gouge the people for huge profits every quarter for greed…

    Nuff said

  • Mike

    What’s wrong with fandroids. You cry over iPhone design. You cry over the material cost of iPhone. Why don’t u ask what’s the material cost of galaxy s3? U think Sammi is making $0? It’s all about demand n supply. Get real.

  • superfly

    Hey mike……. Starbucks called, you left your iPhone 4s+ cable adapter there.

    • Justin

      I’m sure he was looking for that! Thanks for letting him know. He wouldn’t need it, after all the iPhone battery doesn’t die in 3 hours.

  • Richard

    You make it costs Tim Hortons more than thirty cents to make you a cup of coffee that you pay 150 for?

    • sicpuppy

      This is an iphone thread so maybe you should have said Starbucks Double Doubles $5

  • Peter

    Only f**s buy this

    • Justin

      So your lining up on the 21st then?

    • sicpuppy

      I’ll bring you some K-Y , might be useful while waiting in-line .

  • Peter

    No wonder they haven’t changed this flipping phone much. Why bother. The sheep will buy the crapoly machine. What a markup! Its called lets screw or customers.

  • BK

    Can anyone tell me how much it costs to make a Samsung Galaxy S3, or a Nokia Lumia 920 just to give me a reference as to how much more apple charges

    • wake_up_sheep

      rumour says S2’s BOM is about 45% of retail price, I guess all none Apple companies are about the same.

  • iZombie

    All companies mark up the product.Apple is not a non profit corporation.If Googles android wasn’t profitable then it would be like RIM or Nokia or Sony.

    • Carlo S

      @ iZombie, you do realize that Google gives away Android for free don’t you?

  • blackprince

    Enjoy the Apple tax!

  • RobbieCrash

    “that gives them access to newer technologies faster”

    Which new hardware technologies does the iPhone employ?

  • steve

    the problem in canada is the carriers… $800 for a phone… $4000 to use it for 3 years… something is wrong here…

    • Carlo S

      @ Steve, if you’re spending $4k in 3yrs, why on earth would you buy the phone outright? Let your carrier at least subsidize the phone for you.

  • Josh L

    Like buying bottled water or popcorn in the movie theatre. We live in a f**ked up world…

  • mike

    so with these numbers, the iphone id only worth $100 bucks and inflated to $700 for no reason.and the next iphone 5 will be a huge flop. cause theres no real upgrades to the next model and people aren’t dumb enough to fall for apples lies.

  • Booboo

    Does no one realize that the sum of the parts that make up a phone is only a fraction of the cost of getting that phone into a customer’s hand? Someone has to put those parts together. Then they have to ship it all over the planet. It costs money to have retail outlets all across the planet as well. How about warranties, customer service, R&D, advertisement, these are not free. I guarantee you that apple’s profit margin is nowhere near 75% as this article seems to imply.

  • ActivesiN

    no wonder it costs $699.99 to buy this thing outright
    the best technology available, for their loyal fans

  • c

    You guys are i****s, that’s the cost for the parts. Not for the labour to put the damn thing together.

    • Some Guy

      Um… If I’m not mistaken those iPhones are assembled on an assembly line, probably the majority of those iPhones are made by Foxconn who has had trouble in keeping some of their employees alive, again, if I’m not mistaken, there were a few suicides resulting from poor wages, so if this is true, I can guarantee that labour isn’t going to be much more than the cost of the parts.

    • c

      umm some guy is dumb 🙂

  • a.a

    Garbage, complete garbage ! SMD Apple !

  • B2BB

    What a ripoff….$532 off isheep profit and not even a more comfortable wider screen which would make typing easier.

  • faizo

    Decent hardware, relatively reliable software, GENIUS marketing.

    As much as I love my Android (Galaxy S3), no one can deny that Apple is successful as a corporation whose prime goal is probability.

    I don’t think people will be as critical if Samsung had a similar BOM, to which I wouldn’t be surprised.

  • faizo

    ^ oops. Mean’t profitability.

  • BB

    pretty impressive. I guess you don’t really need to be a genius to figure out that half if not more then 60% of the companies profits came from U.S./Canada/Europe…can you imagine we paid off debt as fast as users made apple rich…can anyone say first trillion dollar company!

  • BB

    one unit of there stock = iphone 4, 4s, and 5 price…you can only buy not a great return if you are just buying them….should buy one stock instead…better ROI

  • Allan

    They didn’t include the CNC machining on the phone which isn’t cheap compare to plastic injected parts of android phones.

  • nathan

    Ignoring things like research and development in the product cost, pretty good practice.

    I agree that it’s likely a huge profit per sale, but with a company built on ridiculously good marketting selling the cool alt culture to mainstreamers until it’s the biggest company in the world… to say the final cost of an iphone5 is $168 is a bit misleading.

    And, I know the foxconn people who build it aren’t paid very well, but to completely separate them from the build cost? Or are they grouped into “other”?

  • Some Guy

    I really enjoy Daniel Bader’s articles, my favourite paragraph was this one:

    “While we’d love to see the same charts for products like the Galaxy S III, it’s really Apple’s buying power — it buys millions of the same components at much lower prices than its competitors — that gives them access to newer technologies faster and cheaper.”

    Okay, let’s dissect this; I think Daniel has made it clear that he doesn’t really care about Samsung’s products. All of the Android articles by Daniel Bader that I’ve noticed seem to be short and monotonous. He says that he’d love to see a chart for the S3, but he just continues to explain that Apple buys millions of components at lower prices…

    Um, I think that if Apple uses a lot of the same manufacturers for a lot of their components, then their competitors are getting the same prices. Unless of course Apple has brokered some kind of deal with the manufacturers which would suggest that Apple is doing something underhanded which wouldn’t at all be surprising, or if they buy a lot of overstock which would explain their lack of difference in phones and their overall lack of ingenuity in their line of iPhones, I can just see it:

    Some guy walks up to Tim Cook, “Uh, sir?”
    “Yes? What is it?”
    “You know those few billion 3.5 inch screens that we ordered a few years ago?”
    Tim Cook grows impatient,
    “Yes. Spit it out.”
    “Well we don’t have any more left.”
    “My goodness, what are we going to do?”
    “I know what we are going to do, we are going to innovate!”
    “Uh, sir?”
    “Yes, you heard me, we are going to innovate, we will order 4 inch screens!” ( insert evil laugh ).

    But to continue on Daniel Bader’s comment, “that gives them [Apple] access to newer technologies faster and cheaper”

    Really? So this “access to newer technologies” is the reason why Apple still doesn’t have NFC? And why only now they an LTE capable handset?… ? …… ?????

    Well Daniel, thanks for the insight, but at least on one point we can agree, Apple is indeed making a very nice profit on their products.

  • sak500

    @c you are crying for adding labor cost? Are freaking retarded the labor is the cheapest in the world what apple use and pay for in china. You iDiot dont know that chinese get paid few cents a day to assemble these?

  • Friko

    Apple board and management will pay in hell anyway for all that extortion

  • Richard

    Well, someone has to pay those lawyers. That’s what they call R&D nowadays right?

  • skippypaccino

    Apple does make a killing but…It spends a crap load on advertising. They advertise threw all media sources spending 100 millions per year. That’s how they get people hooked. The power of advertising. Think about it, every show in prime time From now till Xmas will have an iPhone 5 commercial. Lol. After seeing a commercial 100 times , doesn’t it make you want to buy a certain product?

  • abi

    Labour, Marketing, Shipping, contracts, Patent pay-outs, Administration fees, and the Research???

  • nicholas

    if u are own Boss just the phone $167.50,no need pay staff salary, water, electric, food, etc.. i’m wait your own phone.. I phone 5 price no bad.. don’t simply bad comment,