iPhone 6 Component Costs Estimated to Begin at $200, Samsung Supplying Some A8 Chips
As it routinely does for new devices, IHS iSuppli has taken apart the iPhone 6 and iPhone 6 Plus in an effort to estimate Apple's costs for the components included in the new devices, sharing the results with Re/code. According to IHS iSuppli's teardowns, parts and labor costs for the iPhone 6 are estimated to begin at $200 for the 16 GB iPhone 6 model, giving Apple a roughly 69 percent gross profit margin on the devices.
That number of course does not take into account an array of other costs, from research and development to software to marketing and distribution, but it does offer an interesting glimpse at what goes into an iPhone.
The margins are in line with more recent iPhone models but higher than the earliest ones. The gross margin on the iPhone 5, released in 2012, and the iPhone 5s, released last year, were about 69 percent, teardown studies at the time of their release showed. On the lower-priced iPhone 5c, also released in 2012, the gross margin was closer to 68 percent. By comparison, the gross margin on the very first iPhone, released in 2007, was closer to 55 percent.
Apple does earn slightly higher margins on higher-capacity iPhone 6 models, as the 128 GB of storage is estimated to cost $47 more than the base 16 GB storage while the device retails for $200 more.
The iPhone 6 Plus is also a higher-margin item for Apple, with IHS iSuppli estimating the device costs just $16 more to produce than the corresponding iPhone 6 models, with roughly half of that difference coming from the display and the remainder presumably related to the rear camera module with optical image stabilization, a larger battery, and other minor differences.
Another interesting observation from IHS iSuppli is that Samsung does indeed remain involved in production of the main A-series processor for the iPhone. Early teardowns had shown the iPhone 6 and 6 Plus using A8 chips manufactured by TSMC for the first time, but IHS iSuppli says TSMC is providing 60 percent of A8 chips while Samsung is handling the remaining 40 percent.