iPhones Are Getting More Expensive to Manufacture, Here’s Why

With Apple being the single most popular of smartphones in the world, any change in the cost of manufacturing is bound to have a massive ripple effect. It turns out that the iPhone 14 Pro Max was 3.7% more expensive to produce than its predecessor the iPhone 13 Pro Max, and that might make future versions of the phone cost way more than might have been the case otherwise.

With all of that having been said and now out of the way, it is important to note that the most significant component as far as the cost of manufacturing is concerned is that of A16 bionic processes. This represents as much as 22% of the overall cost of making a single iPhone. The upgrade from the A15 meant that $11 were tacked onto the manufacturing costs of every iPhone that was made for the current series.

In spite of the fact that this is the case, the chip was not the factor that increased the cost more than other components. That dubious honor belongs to the whopping 48 megapixel image sensor that the phone comes with. Adding such cutting edge tech was inevitably going to cost a lot of money, and only time will tell whether or not the investment will pay off for Apple in the long run.

Also, the always on feature in the screen has contributed a fair bit to this increase which makes sense since it is not something that comes cheap. This brings the total cost of manufacturing an iPhone 14 Pro Max to around $464 per unit with all things having been considered and taken into account.

All in all, customers are likely going to feel the burn if the costs keep increasing at this rate. Apple is also trying to innovate, so the money that they are bringing in seems like it will be put to good use. All major categories are getting an upgrade, and it will be interesting to see what happens next year when Apple announces the iPhone 15 along with whatever other products will be included in that lineup.

H/T: CounterPointResearch /  Blended Bill Of Materials (BoM) Analysis 

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