14 DAY TRIAL // Apple is a money-making machine, everybody knows this already, so it shouldn’t come as a surprise that the iPhone is one of the products that bring home a substantial part of the bacon.
An analysis recently conducted by Counterpoint Research reveals that Apple spends $464 on the components that it needs to make an iPhone 14 Pro Max whose final price is $1,099.
This means the parts hiding under the hood make for less than 50 percent of the final price, with the display and the processor obviously accounting for the lion’s share with some 20 percent each.
“Apple’s self-designed components have a larger share in the overall BoM cost of the iPhone 14 Pro Max than in that of the iPhone 13 Pro Max. Apart from the A16 bionic processor, Apple’s self-designed chips include PMIC, audio, connectivity and touch control. Our estimate suggests that Apple’s self-designed components account for 22% of the overall BoM cost of the iPhone 14 Pro Max,” the research notes.
The money-making machine
Worth knowing, however, is that Apple spends more on the parts it needs for the iPhone 14 versus the iPhone 13. Counterpoint has determined an increase of 3.7 percent in the component cost of the Pro Max models from the previous year.
Now, I know what you’re thinking: why am I paying double the price of an iPhone?
Technically, you’re not. These estimated costs only concern the actual price of the parts that are installed in your iPhone. The final cost of the device also includes the research and development, assembly, advertising, and the salaries of pretty much everybody that touches your iPhone before you get your hands on it.
Sure, Apple still makes a profit, but it’s not as big as this bill of materials might make you believe it is.