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iSuppli: iPhone 3G costs $175 in parts, $53 less than iPhone

July 17, 2008 by Will Park - Leave a Comment

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We already knew the iPhone 3G ran up a $175 bill of materials (BOM) on Apple’s tab, according to iSuppli. So, there’s nothing new on that front. But, the newest press release from iSuppli gives us a component-by-component breakdown of costs associated with the iPhone 3G.

While we can’t know how much it costs Apple to ship, market, and service all those iPhone 3G handsets out in the wild, iSuppli’s latest component breakdown pegs Apple’s cost on 8GB iPhone 3G parts at about $175 ($174.33, to be more exact). That figure is a good $53 lower than what it cost Apple to put an original, first-generation 8GB iPhone together. Apple managed to cut costs by reusing the Samsung-sourced CPU from the original iPhone and transitioning to a single logic board, rather than the two separate logic boards that we saw in the iPhone.

Here’s a look at what Apple’s paying for iPhone 3G parts:

iPhone 3G BOM from isuppli

iSuppli also estimates that Apple is forking over $50 in technology royalties for each iPhone 3G sold, boosting Apple’s immediate hardware costs to about $225. But, factor in the healthy AT&T subsidy (and presumably other carriers’ subsidies) and Apple’s likely looking at a 55% margin on the iPhone 3G. Not an insignificant profit margin in the mobile market.

iSuppli

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