iPhone 4 Costs $187.51 To Manufacture

iPhone 4 BOM study

Ever since iPhone 4 was launched, we have seen quite a few tear-down pictures and videos of the latest iDevice.

Now, electronics market research firm, iSuppli, has published results from a tear-down study where the company has looked into the costs incurred by Apple in manufacturing the latest iPhone. iSuppli has revealed that a 16GB iPhone 4 carries a Bill of Materials (BOM) cost of $187.51.

This is not the first time iSuppli has conducted such a study. The company has published their BOM estimates for several popular gadgets including iPhone 3G, iPhone 3GS and iPad in the past. BOM estimates play an important part in studying the impact of a product launch on the company's revenues. Apple has traditionally maintained low component costs on the iPhone which has helped Cupertino enjoy higher profit margins. However, the component costs seem to have marginally risen with iPhone 4. You may note that the BOM estimate for the lower end iPhone 3G and iPhone 3GS were estimated to be $174.33 and $178.96 respectively.

The rise in costs could be attributed to newer features incorporated on iPhone 4. Here is a brief on the major components used.

Retina Display:

The latest iPhone model contains a display screen with 960×480 resolution. Steve Jobs claims the retina display on iPhone 4 to be the best among the current crop of smartphones. The display is believed to be sourced from LG at a per-unit cost of $28.50

Gyroscope:

In addition to the accelerometer, the iPhone 4 now includes a gyroscope chip to detect 3-dimensional movement even better. This is expected to offer a better gaming experience to users. The gyroscope chips are noted to have been procured from ST Microelectronics at a price of $2.60.

A4 Processor:

As we have noted in the past, the new iPhone is run on Apple's A4 processor chip, which is also used in iPad. This chip has been manufactured by Samsung Electronics and is estimated to have cost $10.75. It is interesting to note that the price is a significant drop from the $17.00 that iSuppli had posted in its iPad teardown analysis. While the cause for the price drop has not been stated, we believe that the higher volumes could be a primary factor.

Camera Module

The latest iPhone comes with a 5-Megapixel camera along with a front-facing VGA module. The improved technology has definitely resulted in a marginal rise in prices. The two cameras have been pegged at $9.75 and $1.00 respectively. For a perspective, the 3-Megapixel camera on iPhone 3GS was estimated to have cost $9.55.

Here is a comprehensive breakdown of the component costs:

iPhone 4 BOM study

Do note that iSuppli's BOM estimates do not include costs rising from labor, shipping, advertising, software development or patent licensing and so the overall costs are expected to be much higher. Nevertheless, the teardown analysis provides an interesting perspective on the estimated profit margins that Apple stands to make from the sale of iPhone 4. What are your thoughts?

[via iSuppli]

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  • Weeee

    Oh wow. That's more than I expected. I thought it be like 100. Haha. The $400 price is good then. Aince they want to make profit and pay for research n stuff.

  • Weeee

    Since*

  • waka50

    I would rather pay slighly more for an iphone 4 that works without any issues…. Cost cutting doesn't always pay off!!

  • Munir Algonn

    apple sayed that they sold 1.7m iphone 4
    if we asume 500$ per divice
    thats mean they make 850M $ in 3 days

  • Jorg3

    Why in the image it says Samsung A4 processor I thought it was apple's processor not samsung

  • Roger

    You are an idiot. This isn't your safeway shopping cart. You can buy all the pieces but you need to assemble them into a phone and load software to connect all the components. You are an idiot. This is not a simple look at how cheap the parts are.

    Wow! You can make an iPhone for 187$??? Do it. I will buy two. Until you can do so, blow me. You are not buying arbitrary hardware, you are buying an iPhone 4.

  • Jcm800

    Lmao what research? LG made the Retina display for a start, not Jobs and his 'Engineers'

  • eurosnob

    you are a fool, how long do you think it takes to develop a new product, from design to software to manufacture, yes they buy parts in but you still have to develop, and test, things don't just fall together…. you are such a mug!!!!

  • eurosnob
  • DG

    Probably designed by apple but manufactured by Samsung. Foxconn assemble the iPhone (to the best of my knowledge) but that doesn't make it the "Foxconn iPhone 4".

  • key

    and the price isn't 400 bucks either nerd. it's 199 and 299 WITH contract. otherwise it's 599 and 699……

  • key

    haha i love these videos. 90% of them are hilarious.

  • Nick

    IPHONEHACKS: EVERYTIME YOU GUYS PUT UP A PICTURE IN THE MIDDLE OF THE ARTICLE EXPLAINING SOMETHING, OR IN THIS CASE GIVING DETAILS OF THE MATERIALS AND COSTS RELATED TO THEM, THE PICTURE IS ALWAYS SHRINKED, AND ITS REALLY HARD TO READ IT, A NICE LINK TO THE PICTURE (OR TABLE IN THIS CASE) WOULD BE NICE, OR AT LEAST A ZOOM FEATURE.

  • Franky j

    Oooh! now that explanes why there's so much problems. Joky joke.

  • key

    fuck your iphone….i'll create a bogus account and skyrocket that price and never pay……you won't find me

  • CristV77

    and its because of ppl like you that the world degrades minute after minute, so sad, it will come back to you, u'll regretted after :D

  • superfreak

    Great! Wonderful!!! Now can you please release a jaibreak for ios4 on a 3GS.

  • Brundon

    actually on an early upgrade it is.. before your gonna call people out ya better know the facts

  • Chris

    actually mug its £499 here in uk get your facts right, knob

  • Tom

    anyone in the uk thats £124.35

    uk rules :D

  • Karlos

    Wow, this comment section gets filled with more and more douchebags everyday.
    Pathetic.

  • http://webfishcreative.com Dustin

    no it is since

  • http://www.tenniscoachingmelbourne.com.au Tennis coaching Melbourne

    I kind of can't believe this..

  • http://www.thepersonalinjurylawyers.com.au Personal Injury Lawyers

    Same in OZ her…jeez
    When the price can be reasonable

  • SALVADOREAN

    Right!
    We as customers ending paying a fortune for iPhone 2,3G, 3G S and so on, of course they also(AT&T) want you to get screwed with 2 year string attached contract . If you are able to do math, you will realized that with the amount of dollars you have paid, you could've bought 5 brand new iPhones+service+fees.

  • SALVADOREAN

    It's already out, check the old posting section or ask the devs team.
    Good luck!

  • Nick

    Do you really beliave what you are saying? Don't forget all the costs that are including in manufacturing, design, programing, advertising, services, maintenance. Besides, ofcourse they are going to make money out of us, what would be the purpose of owning such a big compnies, if you can make money out of your products? We wouln't even have casinos for that matter :)

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