Samsung Galaxy S5 costs around $256 to build according to market analyst
According to Andrew Rassweiler, analyst at market research firm IHS, the Samsung Galaxy S5 costs somewhere around $256 to build. The latest smartphone in the Galaxy S series was released just a while ago but it is already considered one of the best devices around. The secret to the S5 isn’t innovation, it’s evolution as Andrew himself pointed out: “There’s no breakthroughs, there’s nothing earth-shattering. It’s really just a continuation of what has come before.”
If you plan on buying the smartphone on contract it will cost you around 200$, while a no strings attached Galaxy S5 sells for about $660. This means that Samsung gets about 60% of the profits for each device sold without a contract. “Inside we see mostly a lot of recycled components that we’ve seen before. There’s really nothing special inside where Samsung is pushing the envelope” says Andrew. So let’s take a closer look then at some of the components and their costs.
The most expensive component seems to be the smartphone’s 5.1-inch Super AMOLED display which costs around $63 according to IHS. Next, we have the DDR3 RAM and flash memory chips which combined cost about $33. Last but not least we have two of the most noticeable features available to the Samsung Galaxy S5. The swipe fingerprint sensor only costs about $4 which is much cheaper than the $15 static fingerprint sensor that the iPhone 5 uses. The Maxim heart rate monitor costs just $1.45, Andrew also adds that “if there’s a winning supplier with this phone, it’s Maxim”.
The bill of materials only includes hardware and the estimated cost of assembly, which is somewhere around $5 according to IHS. The costs of software development, distribution and marketing are not taken into account. Rasswiler also mentioned that lately the IHS is noticing a certain trend with Samsung made smartphones: “Our main takeaway is that Samsung has been moved up to the higher end of the cost spectrum. It used to be that its typical flagship phone sold for $600 without a contract and had a bill of materials of about $200, now they’re inching up above $250 regularly.”