Apple Inc. AAPL brought some major upgrades with the iPhone 15 Pro Max. This has led to a significant increase of 12% in the component cost of Apple’s latest flagship smartphone compared to its predecessor.
What Happened: Apple’s cost of components for manufacturing the iPhone 15 Pro Max has increased by 12% to $558, according to an analysis done by Nikkei, reported tipster Revegnus.
It is worth noting that this is just the bill of materials and does not include research and development, marketing, administrative, and other costs.
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The biggest contributors to the iPhone 15 Pro Max’ increase in cost of components were the titanium frame and the new A17 Pro chipset. The improved telephoto camera was also a notable contributor to the rise.
According to the analysis, the new titanium frame alone costs $50 – a 43% increase compared to the steel frame on the iPhone 14 Pro Max. But by far, the biggest cost increase – in absolute terms, is due to the A17 Pro chipset. It cost Apple $130, while last year’s A16 Bionic chipset cost $102 only.
Apple was able to offset some of this cost increase thanks to the falling prices of memory and storage. Storage alone accounts for nearly 10% of an iPhone’s cost of materials, so a decline here will have a notable impact.
In addition, offering the 256GB version as the new starting option also helped Apple offset some of the cost increases. While storage costs have fallen by 50% in the last year, Apple still charges the same $1,199 for the 256GB version of the iPhone 15 Pro Max, just like the iPhone 14 Pro Max.
iPhones Could See Price Hikes From 2024: According to Nikkei, all four iPhone models could see price hikes from 2024 as the company tries to pass on the increasing costs to its customers.
Notably, the standard iPhone 15 witnessed the most significant cost increase at 16%, followed by the top-tier iPhone 15 Pro Max at 12%, iPhone 15 Plus at 10%, and iPhone 15 Pro at 8%.
It’s unclear if Apple will bump up the base storage of future iPhone models to 256GB, just like the iPhone 15 Pro Max, or if the starting price will increase.
Image credits – Apple
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