iPhone X Component Costs Higher Than iPhone 8 by 25 Percent

As per an analysis of the internal components of the iPhone X, the handset has a higher gross profit margin than the iPhone 8 for Apple. The components used in the iPhone X are 25 percent more expensive than the iPhone 8, but the device also has a 43 percent higher retail price.

The iPhone 8 with its retail price tag of $699 has a gross margin of 59 percent while the iPhone X has a gross margin of 64 percent with a price tag of $999.

The high component price tag of the iPhone X can be attributed to its new 5.8-inch Super Retina HD display which alone costs $65.60. The 4.7-inch display on the iPhone 8, for comparison, costs only $36. The stainless steel chassis on the iPhone 8 is also pretty expensive and costs $36. The aluminium chassis used on the iPhone 8 is a fair bit cheaper at $21.50. Overall, the total component cost inside the iPhone X comes to $357.50 which is significantly higher than the component cost of $247.51 and $288.08 for the iPhone 8 and iPhone 8 Plus.

The internal layout of the iPhone X is among the most densely packed ones in a smartphone. To make optimum use of the internal space, Apple went with a dual-cell battery design and a stacked motherboard which likely further increased the overall component cost. Do remember that component cost do not include the billions of dollars spent by Apple on R&D, developing new technologies like Face ID for the iPhone X, and production cost. The component costs just don’t paint an accurate picture of how much the iPhone X costs Apple to manufacture.

[Via Reuters]

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