While the iPhone x is expensive to buy, it is also expensive to manufacture. According to Techinsights, the iPhone X’s parts add upto $375.50. To arrive at this estimate, Techinsights opened up an iPhone and calculated the cost of all the components. However these costs are just an estimate and Apple hasn’t commented about this. The new iPhone X starts at $999, which means that Apple earns the profit at a gross margin of 64 percent on a single unit. The iPhone 8 which $699 helps Apple earn a gross margin of 59 percent. The new iPhone X includes hardware like a big OLED display, wireless charging, and true depth camera system for its facial recognition system. These features give the phone much of its appeal but these also add to its price.
According to a report, the iPhone X’s 508-inch OLED display panel and its associated parts cost about $65.50, which almost costs double than the price of iPhone 8’s lcd. Further estimates carried by techinsights show that the 256gb version iPhone 8 plus is more expensive to make than the 64gb iPhone X with a cost of $367.50 per unit. This means that the iPhone 8 plus is more expensive to make but still Apple charges more for its iPhone X.
As we have seen at various Tim Cook’s addresses where he emphasized on the fact that the pricing of iPhone X has been precisely based on the value of its experience. The premium-priced phone is termed by Apple as an inception of the next generation smartphones. When the cost breakup of iPhone X is closely evaluated, it can be easily found the Apple has placed a lucrative profit margin on its 10th Anniversary phones.
One of the best things about the prevalent power of media is that these tech giants are open about the breakdown of their costs and this reinstills self-confidence in the customers and make the process of manufacturing and trading transparent and easy to audit.