It would shock you to know that the Samsung Galaxy S5 which launched last week in numerous countries around the globe, costs around $256 to manufacture according to a report by market research firm IHS, and yet is was actually announced to be retailed at $660 without a contract and that’s a 60% increase on the price.
Andrew Rassweiler, an analyst at IHS, says that there’s nothing too exciting inside the Galaxy S5 hardware-wise. “There’s no breakthroughs, there’s nothing earth-shattering. It’s really just a continuation of what has come before.”
According to the report, the most expensive part in the Galaxy S5 is the 5.1-inch 1080p Super AMOLED panel, which IHS estimates costs around $63. Samsung-made LPDDR3 RAM and NAND costs a combined $33, while the heart rate monitor on the rear from Maxium costs just $1.45. It’s no surprise to learn that the swipe fingerprint sensor in the Galaxy S5, at a cost of $4, is much cheaper than the iPhone 5s’ static fingerprint sensor, which costs an estimated $15.
The bill of materials includes an estimated cost of assembly ($5), but doesn’t take into account the cost of engineering, software development, distribution, or marketing. All of these aspects will take a sizable chunk out of the $404 Samsung is left with from each Galaxy S5 sold after hardware costs are taken into account.
In comparison, the iPhone 5S costs an estimated $199 to build, and retails for $649.