The Cost of Building the New iPhone 5S and 5C

When Apple first announced the iPhone 5C a few weeks ago, there was a lot of shock at the price. Sure, the on-contract pricing isn't bad, but the up-front cost of the phone isn't exactly economical at $549. Especially for a phone that everyone thought would be a budget or entry-level iPhone. Yes, it seems the 'C' in 5C most certainly stands for 'color' and not 'cheap,' but how much does it cost Apple to build an iPhone 5C? Or the iPhone 5S (which starts at $649) for that matter?

 

According to a teardown analysis from IHS and obtained by AllThingsD, the cost of components and manufacturing for the iPhone 5C is from $173 to $183, depending on capacity and including $7 for assembly. The iPhone 5S costs at least $199 (for the 16 GB model) for components and assembly. What's more, IHS says that aside from the fingerprint sensor, A7 processor and new memory chips in the iPhone 5S, they're essentially the same phone. Of course, this is just the cost for components and assembly, and Apple has to factor other costs into the production of the iPhone, including shipping and marketing.

 

Apple released the iPhone 5S and 5C last Friday following a September 10 unveiling. The company on Monday revealed that it had sold nine million iPhones over the weekend, though the company didn't offer any sort of breakdown of which phone sold more.

Follow Jane McEntegart @JaneMcEntegart. Follow us @tomshardware, on Facebook and on Google+.

Create a new thread in the US News comments forum about this subject
This thread is closed for comments
20 comments
    Your comment
    Top Comments
  • sketysh
    Interesting. Now make a similar article for some Android phones.
    20
  • andystanley
    Hmmmm.....Are they making any money from these phones? Seems like awfully slim profit margins ;)
    19
  • none12345
    Speaking from the standpoint of a small business owner. On an item that sells for $500, my cost will be somewhere between $410 and $440, meaning profit of 60-90, before overhead, rent, employees, power, etc, etc.

    Having a profit margin of $450 on an item that sells for $650 would be absolutely godly. But, id feel pretty dirty making that kinda profit margin on items in that price range.
    13
  • Other Comments
  • sketysh
    Interesting. Now make a similar article for some Android phones.
    20
  • andystanley
    Hmmmm.....Are they making any money from these phones? Seems like awfully slim profit margins ;)
    19
  • Blazer1985
    Not exact. People let Apple do this.
    SHUT UP AND TAKE MY MONEY! :-)
    -7