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iPhone teardown: $200-220 build cost

updated 03:00 pm EDT, Mon July 2, 2007

iPhone teardown

A teardown of Apple's iPhone by Austin-based Portelligent reveals a likely manufacturing cost of $200 for the 4GB model and $220 for the more expensive 8GB version, signaling extremely high margins for the Cupertino-based company which has already sold more than half a million units, according to one analyst. The iPhone includes a main microprocessor with an ARM core design and NAND flash storage from Samsung, NXP with another chip sporting an ARM core design, and power management chips from Philips, Texas Instruments, and Linear Technology, according to BusinessWeek.

Chips from Infineon, Skyworks, RF Micro Devices, and Marvell Technology supply the iPhone's wireless capabilities while other chips from Cambridge Silicon Radio enable the handset to connect to wireless headsets. The iPhone's chip that senses motion, which is called an accelerometer, is supplied by STMicroelectronics. Display chips are supplied by National Semiconductor, Broadcom, and NXP. The 2-megapixel camera mounted on the back of the iPhone is powered by an imaging chip from Micron Technology.

 
Previous Comments

Ah..

07/02, 03:39pm reply

But they aren't including in that the "three years in the making" R&D costs. Nor all the costs associated with various legal battles to keep it from leaking to the public (because, up until January, no one even came close to imagining a cell phone from apple!).

testudo

Fresh-Faced Recruit

Joined: Aug 2001

0

profit

07/02, 03:44pm reply

So what does that come to for profit? Probably about $100M?

OtisWild

Junior Member

Joined: Feb 2005

0

Other costs...

07/02, 04:07pm reply

... come on, MacNN. That doesn't suggest extremely high margins at all. The development must have been tremendous, and let's not forget all that marketing.

PookJP

Mac Enthusiast

Joined: Jan 2001

0

But eventually

07/02, 04:55pm reply

when all of those costs are covered by an even more tremendous number of sales, perhaps we'll see a price drop?

I'm still holding out for that simple, large capacity, widescreen-video iPod. I hope someday soon if they get the kinks out of this leg of their business. But wasn't the iPod another one of those legs? Let's not let gout get to that important iPod leg, much less the most-important Mac leg.

danviento

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Joined: Dec 2005

0

R&D

07/02, 06:44pm reply

hey, have you guys not been following,

there were no extra R&D costs - they just took people off of other programs to get this done - that's why they've stopped innovating on everything else (Note to Steve - please prove me wrong!)

chucker

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Joined: Mar 2007

0

Note to chucker and other

07/02, 06:55pm reply

Do you all, and you know who you are, actually think that Steve Jobs or anybody else for that matter, from Apple INC. actually reads posts from Macnn? You're more than likely fooling your self's if you do.

David-0109

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Joined: Apr 2007

0

*s

07/02, 06:56pm reply

My previous post's title should have ended with "others" and not other. Have a nice day.

David-0109

Fresh-Faced Recruit

Joined: Apr 2007

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free labor?

07/02, 08:06pm reply

I didn't notice if that cost includes labor and shipping. I'm sure the people assembling are working for free and the airline/shipping company transport for nothing. It also didn't cost anything to shut down stores for hours without income to train and prepare employees. And the marketing/ads to bring in the customers was also donated. I think Steve actually gets to pocket the $380-$400 per iPhone himself actually. Everyone loves him so they donate all their work/time. Steve is great.

simdude

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Joined: Jun 2004

0

costs

07/02, 10:36pm reply

Um, do you people even come close to understanding what these guys do (which, BTW, they do with all of Apple's stuff). They tear down the item to determine the cost of the components. That's all. Nothing else. So it has 50% margins. They're not saying that's profit, just margin from cost of product to cost to consumer.

Man, you all really need to stop looking at everything as if its a personal slap against you and apple.

LouZer

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Joined: Nov 2000

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