Samsung Galaxy S5 teardown reveals a bill of materials worth $256

by: Rob TriggsApril 15, 2014
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samsung galaxy s5 aa (8 of 36)

We’ve already had a look at what goes into the new Galaxy S5, thanks to this teardown, and according to an analysis conducted by market research firm IHS, all of the components in the Samsung Galaxy S5 costs around $256 to purchase and put together.

Samsung latest flagship handset is currently being sold for approximately $650 SIM-free, or around $200 with a contract, but the latest gadgets never do come cheap. That works out to a rather healthy $394 profit margin for the SIM-free handset, which equates to around a 60 percent profit for Samsung. Of course that doesn’t factor in other costs such as software development, shipping, or marketing.

IHS estimates that Samsung’s 5 inch Super AMOLED display module is the most expensive component, costing around $63 to produce, whilst the fingerprint scanner and fitness biosensor only cost $15 and $1.45 respectively. I guess it can’t be said that Samsung is wasting a lot of money on small features, they are some of the cheapest components. Samsung also manufactured its own DRAM and flash memory modules for the handset, which only set the company back a combined cost of $33 per device.

“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,” Andrew Rassweiler, IHS research

I suppose this bill of materials isn’t so surprising if you recall that the Samsung Galaxy S4 cost around $236 to produce, and not too much has changed internally between the two handsets. If anything, it seems that Samsung may have benefited from falling costs, in some instances, by reusing older components. Samsung’s AMOLED display cost about $75 when the Galaxy S4 was built but has now fallen to $63, the savings from which have been spent on new features, such as IP67 compliance.

“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,” Rassweiler

Samsung’s flagship production costs have been steadily creeping up though. The Galaxy S3 was estimated to cost $205, the Galaxy S4 $236, the mighty Note 3 $232, and the latest model ends up at $256, making it Samsung’s most expensive smartphone yet. As a side note, the latest iPhone has a bill of materials totalling just $199, yet it still retails for a similar price.

  • Dimitar Gospodinov

    I think you are about to loose the biggest audience you have ATM (Samsung fans) for exchange of a couple of hundred clicks…

    • MasterMuffin

      If someone gets hurt by this, he’s the biggest idiot in the world :)

      • Dimitar Gospodinov

        it’s not about being hurt…
        Do you think an article like this is worth something more than feeding the fanboy wars?

        • MasterMuffin

          I like this kind of useless info :) And I don’t see how this is feeding any fanboy wars (other than the last line about iPhone)

          • Dimitar Gospodinov

            check out the G+ post ;-)
            I am sure more comments like the one about the iPhone are coming…lol

  • Everybody knows that every high end phones are all overpriced and are sold at inflated prices but what can you do except buy it used or just wait until it gets cheaper.

  • Sparthir

    I wonder how accurate this teardown is. Sure that is what the components cost but as anyone who makes anything will tell you it is a lot more expensive than just parts to get a device from raw materials to finished product in a customers hand.

    By the time you add in cost of the plant, machinery, labour, packaging, insurance etc etc and not to mention marketing and shipping etc.

    • MrMagoo

      I’m guessing you didin’t actually read the article? It says everything you just mentioned…. damn near verbatim.

      • Mike Reid

        Yeah.

        But it’s just plain WRONG to say the profit margin is $394 or 60%.

  • kokekin

    So, who is the idiot here? Samsung (for lesser earning per unit) or iSheep (for overpaying for lesser material)

    • MasterMuffin

      Neither

  • Alienjazz

    Guess Im MOST bothered that a 2014 “flagship phone” is only coming with 16 gb of storage. Thats 4 year old tech. : /. Really was interested in going from my GN2. Uhhhh, not worth it.

    • WitnessG

      You know you could just put in a sd card if it bothers you that much.

      • Cole Raney

        An SD card won’t fix it. SD cards are limited in some ways by newer versions of android. Plus, with the galaxy s3 samsung didn’t let you put apps on the sd card. They may still not let you do it.

        • Eurasianman

          With Android 4.3, you can use the SD card to your heart’s content. Most apps can be moved over to the SD card. You can also have Google Music store your music on the SD card.

      • Alienjazz

        Yea, I have a 64gb card in my note 2 for the last 2 years.know how much I still have available? 60 gb. Know why? Same thing the other guy told you. Google play and Samsung wont let you put anything on it. And the thing I said in my post is Im bothered by a brand new flagship device only coming with 16 gb of space. With Att and samsung garbage on it plus the operating system, you only have 7.6 gb available before you even turn the phone on. Thats what bothers me….

        • jeff

          I agree. U hit the nail on the head. We ought to have freedom to move almost anything to the card.

        • The Decline

          Plenty of apps that you can use that will move the vast majority of apps to sd card. It is stupid though that there is no option to just install apps directly to the sd card and you have to use third party software to move them properly.

          • Alienjazz

            Sad part about that also is even tho there are apps, half dont work properly if at all. And even if you were able to get a game like Asphalt 8 on a card, trying to play it from the card would be like watching a slideshow. Samsung coulda just added 32 or even 64gb of storage (like other makers). : /. Woulda been a No Brainer to buy this phone.

          • The Decline

            Try “GL to SD”, I play asphalt 8 from my sd (as well as other demanding games) with no problems at all, just make sure you have a reasonable card and not just the cheapest you can find. It moves about 80% of the games I have tried to move with no issues at all.

            Edit: Just checked and i have been able to move closer to 90% of my games to SD using this app.

  • Costa

    No problemo, I buy neither Galaxy S5 nor iPhone 5s

  • Clint McKay

    I’m not into name calling but iphone users are paying just too much! I don’t understand if they are loyal, if they think its worth the buck or just plain ol’ stupid.. But then, it all comes to preferences! A weird preference indeed…

  • ComeBackSteveJobs

    S5 is a total lag fest

    • Terrence Thompkins

      Lies and Garbage that have absolutely nothing to do with the article.

    • Alienjazz

      Uhhhhhhhhhhhhhhh, no.

      • ComeBackSteveJobs

        Are you trying to tell me touchwiz is a smooth operating system like sense or stock android?

        • Alienjazz

          Well, obviously first of all touchwiz is a skin, not an operating system. Dont know what sort of recent samsung phones youve used (if any), but using a term like “total lag fest”???? Ummmmm, yea, no.

    • K2

      You are doing this deliberately, arent you?

      • K2

        Trying to start another flame war.

  • David Peterson

    It is just wrong to say the profit margin is 60% on this phone.

    I see that the author acknowledges there are a LOT of other costs that go into R&D, engineering, marketing, assembly, etc, but then he goes on to imply that the bill of materials and the msrp are the only two numbers that exist.

    I wouldn’t be surprised if the actual margin is between 10-20% per unit

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    • j7981

      Not the usual Chinese wholesalers?

  • Johan Fourie

    Labor / manufacturing, R&D, Advertising etc. Something has to get the money back. Therefor profit margins.

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