According to research firm IHS, the Samsung Galaxy S6 Edge costs more to make than the iPhone 6 Plus, yet Samsung sells it for slightly less. A breakdown of the phone’s bill of materials reveals that it could cost Samsung around $290 to build a 64GB Galaxy S6 Edge, whereas the iPhone 6 Plus tops out at around $263 for the 128GB model. At full retail, the price of a 64GB Galaxy S6 Edge runs as low as $799; the 64GB iPhone 6 Plus starts at $849.
Of course, this is the standard speculative report that IHS puts out for every phone, many of which are denied by phone manufacturers. The cost could officially be less or more, for all we know.
So what makes up the cost? This report suggests that it costs Samsung $85 per device for its display and touchscreen elements, $29.50 for its Exynos 7 octa-core chip, $27 for its DDR4 RAM, and another $25 for its 64GB of storage. The rest of the costs are a combination of things, but their teardown did reveal that Samsung is using a Qualcomm “baseband chip” in the Verizon variant that cost an extra $15.
Of course, since this is Samsung going premium for the first time, and we are already comparing the cost of the Edge to the cost of an iPhone, we should point out that an IHS analyst noted that the rising costs are likely because Samsung is copying Apple with the little things, like metal enclosures and design choices that are “similar to Apple’s.” Except that the Galaxy S6 Edge looks nothing like an iPhone. But, hey, quotes!
Phones are expensive. Margins are great, for companies like Apple and Samsung.