iPhone 8 has the cost of the phone's components revealed today along with those of 8 iPhone Plus, revealing what kind of difference there is between the production price and the sale price. iPhone 8 has an estimated production cost of $247.51 for the standard version with 64 GB of storage space, $10 more than the one calculated for iPhone 7 last year, but with 32 GB of storage space.
iPhone 8 Plus, on the other hand, has an estimated production price of $295.44, $18 more than the one estimated for iPhone 7 Plus last year. Basically, iPhone 8 and iPhone 8 Plus are respectively 10 and 18 dollars more expensive, in production, than their predecessors, but the Apple company increased their selling price by 30/50 dollars, or euros, so it compensated more better than the price difference should have been.
The iPhone 8 has a higher production cost due to the higher price paid by Apple for the memory modules, the new cameras, the A11 Bionic chip and the new glass case. The True Tone screen used by Apple in the iPhone 8 and iPhone 8 Plus is not cheap either, but neither is the aluminum structure that keeps all these components firm and prevents bending in daily use.
iPhone 8 – production cost and Apple's profit
The iPhone 8 and iPhone 8 Plus have the A11 Bionic chip that is $5 more expensive than the A10 Fusion chip in the iPhone 7 series, while the wireless charging coil has also increased costs by $2. In the case of the 256 GB memory chip, we are talking about a $6 increase in the production cost compared to the iPhone 7 series, so Apple's partners no longer seem to have offered as good prices for Americans.
iPhone 8 and iPhone 8 Plus had estimates for production costs wrong by about $20 last year, they were calculated at a lower value than the real one. It is not known if we are now talking about a similar situation, but it is possible that the iPhone 8 and iPhone 8 Plus will have higher production costs than what analysts are currently estimating, so this must also be taken into account.
"The added value went to memory, camera, and processing. That's where we can materially identify where they've improved the overall product, and hence why they can command a higher price for it. The iPhone 8 represents an evolutionary upgrade to the tried-and-true iPhone business formula.”
iPhone 8 has a production cost that is 422 dollars lower than the production cost, while in the case of iPhone 8 Plus the difference is 504 dollars. Of these amounts, more than half represents Apple's profit from the sale of iPhone 8 and iPhone 8 Plus, the difference going to research, development, marketing, transport costs, packaging and other costs that are not taken into account separately from production.
