The Real Cost Of The iPhone 5S & How Much Apple Makes

Many people are curious how Apple became one of the world’s most profitable companies, and that is of course a legit question. It is mainly thanks to iTunes and the App Store. Through these revenue streams, Apple has filled their coffers with countless of billions of dollars which seem to be brilliantly spent on developing new technologies for their consumers. The iPhone 5S is one of those products, but another intriguing question is of course, what is the real cost?

Apple is known for making really beautiful, and streamlined technology and the epitome of that naturally is the iPhone 5S. In the store, it costs roughly $649.00 for the 16GB model but what exactly is the real cost of manufacturing this beast of a smartphone? In order to find that out, CNN turned to TechInsights to see if they could estimate the real cost of the iPhone 5S, and how much Apple is actually making off of their now incredibly successful flagship smartphone.

As they went through the smartphone, it was determined that the most expensive part of the iPhone 5S, with a cost of $36.50, was actually the 64 bit A7 processor that Apple uses to drive their phone. After calculating the combined cost of all the parts within the iPhone 5S the final real cost of manufacturing the smartphone was actually a mere $194.00.

With a little bit of simple math, this means that Apple is making roughly $455.00 per iPhone 5S sold. We have to remember that this does not include research and development costs of the phone which of course is not exactly cheap. Still, Apple is making a formidable profit of their now popular cash cow smartphone and can expect to do so for at least a year or so until they unveil their next tier of the iPhone.

No doubt Apple is still making headlines even though Steve Jobs, the once protector and said visionary of the company, is no longer at the wheels. I think we can safely say that Apple is quite capable of continuing the success of their product lines, even though the vision undoubtedly has changed path since the departure of its founding father.