What is the real cost of making an iPhone? From parts to price tag

By Editorji News Desk
Published on | Jan 25, 2024

iPhone Manufacturing Cost Overview

The cost to make an iPhone is around $423, significantly less than its retail price range of $799 to $999.

Image Credit: Nikkei via AppleInsider

Apple’s Market Share & Profits

Apple holds 22% of the global market share and captures 75% of the smartphone industry’s profits.

Image Credit: WSJ

Labour Costs in iPhone Production

Average worker salary at iPhone factories in China is $10/hour, contributing to controlled manufacturing costs.

Image Credit: WSJ

Why China for iPhone Manufacturing?

China’s specialized skills in tooling engineering and logistical advantages make it the prime location for iPhone production.

India’s Manufacturing Milestone with iPhone 15

The iPhone 15 marks a first as it’s made in India for global markets at launch, showcasing India’s growing manufacturing capabilities.

Apple’s Custom Components

Custom-designed components are key to the iPhone’s high performance, affecting the overall manufacturing cost.

iPhone vs Samsung Manufacturing Costs

The iPhone 15 Pro Max manufacturing cost is $558, more than the Samsung Galaxy S23 Ultra’s $469.

Image Credit: Counterpoint BoM analysis

Profit Margins on iPhones

Apple’s strategic pricing leads to substantial profit margins, estimated between 38% to 50% for the iPhone 14 Pro.

Image Credit: WSJ