October 31, 2020

Samsung Galaxy S8’s manufacturing cost revealed

Samsung Galaxy S8 , which recently launched in India, costs Rs 57,900 (MOP of base model) in the country. Needless to say, this is not the actual cost Samsung incurs to manufacture each Galaxy S8 unit. Companies always sell their products at higher prices to generate profit, and the prices include other factors such as marketing costs and taxes as well. So how much profit Samsung stands to earn on each Galaxy S8 it sells? IHS Markit seems to have the answer.
According to the report, the total bill of materials (BOM) for the 64GB storage variant of the Samsung Galaxy S8 comes out to be around $301.60 (roughly Rs 19,500). After adding the manufacturing cost of $5.9 (roughly Rs 381), the final amount comes to $307.50 (about Rs 19,900).
It has been mentioned that this amount is $43.34 (roughly Rs 2,800) more than what it took Samsung to manufacture the Galaxy S7. The S7 edge was manufactured at $36.29 (roughly Rs 2,300) less.
IHS Markit has not detailed the component price of each device. However, it says that the NAND flash memory and DRAM cost $41.50 (roughly Rs 2,700) in total. The 3,000mAh battery costs $4.50 (roughly Rs 291).
Samsung disables Bixby button remapping on Galaxy S8/Galaxy S8+ smartphones
All said, the Galaxy S8’s cheapest version, which costs $720 (roughly Rs 46,500), is priced exactly $412.5 (roughly Rs 26,700) more than what it took the South Korean tech giant to manufacture. As mentioned above, this is not the exact cost profit Samsung earns on each unit. The expenses include marketing costs, taxes, retailer and carrier cuts, and more.
“While there are new non-hardware features in the Galaxy S8 such as the Bixby virtual assistant, from a tear down perspective the hardware in the Galaxy S8 and that of the forthcoming new iPhone is expected to be very similar,” said Andrew Rassweiler, senior director of cost benchmarking services for IHS Markit.