A report from marketing research firm IHS revealed that it costs Samsung $256 to produce the Galaxy S5. You may wonder where the rest of the $650 up-front cost goes. Check out our guide to the cost of an iPhone for an idea, but a good chunk is profit, packaging, transport, marketing, and retail gets a cut as well.
According to Android Authority, this makes the Galaxy S5 the most expensive Samsung smartphone ever in terms of production costs.
“Our main takeaway is that Samsung has been moved up to the higher end of the cost spectrum. It used to 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,” said IHS analyst Andrew Rassweiler.
Its earlier versions, the Galaxy S4 and the Galaxy S3, cost $205 and $236 respectively. The most expensive component in the Galaxy S5 is its 5-inch Super AMOLED display, which costs $63 to produce. Its fingerprint scanner, which has been revealed as hackable with the use of a wood glue mold, only costs around $15. One of the phone’s cheapest component is its biofitness sensor, which only costs $1.45 to make.
Despite the Galaxy S5’s higher production value, it doesn’t really represent a significant step up in hardware from the Galaxy S4. “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 … There are no breakthroughs, there’s nothing earth-shattering. It’s really just a continuation of what has come before.”
Nonetheless, early indications point to the Galaxy S5 being a hit. Samsung won’t provide specific numbers for its opening weekend, except to say that sales are better than the Galaxy S4 launch last year.