iPhone 12 Bill of Materials reveals retail price is more than twice its value

Fomalhaut Techno Solutions and Nikkie Asian Review took apart the Apple iPhone 12 and iPhone 12 Pro to assess the origin and cost of the components that make up the devices (via GSM Arena). 

Per the report, the estimated bill of materials (BoM) cost for the iPhone 12, which starts at $829, is $373. The BoM for the iPhone 12 Pro is $406. The baseline variant retails for $999.

The component that has seemingly inflated the iPhone 12 BoM the most is the Snapdragon X55 5G modem made by Qualcomm, with cost running at $90 per unit. After that, we have the OLED panel, which costs $70. Samsung made the bulk of displays reportedly, and it also manufactured memory chips for the phones.

The A14 Bionic contributes approximately $40 to the iPhone 12 BoM, and RAM and flash memory cost $12.8 per unit and $19.2 per unit, respectively.

The new phones feature Sony’s CMOS image sensors and they are seemingly priced at around $5.40 to $7.40 per unit.

The report also states that the iPhone 12 is smaller than the iPhone 11, despite the fact that it offers 5G-connectivity, and at 162 grams, it weighs 32 grams less than its predecessor, thanks to a smaller battery and vibrating motor.

The battery capacity has been reduced by 10 percent and the motor has also been shrunk to create room for additional parts. 

Components made in South Korea account for 26.8 percent of all parts in the iPhone 12 by value, and 21.9 percent and 13.6 percent of the parts come from the US and Japan, respectively. 

China remains the key assembling site, but the country only accounts for nearly 5 percent of the parts by value. 

Although iPhone 12’s retail price is more than twice its BoM, the figure doesn’t represent pure profit.

The bill of materials shows how much it costs a manufacturer to source components needed to make a product and it doesn’t reflect other expenses such as salaries, marketing, research and development, and software.

The parts cost for last year’s iPhone 11 Pro Max which went for $1,099 was $490.50 according to TechInsights. 

Although we don’t have the BoM for the iPhone 12 Pro Max yet, given that it is largely the same as the iPhone 12 Pro, it doesn’t look like the total component cost has increased when compared to last year.