Samsung is Earning $440 on Sale of Every Galaxy S7 Smart Phone

The Samsung Galaxy S7 & Galaxy S7 Edge are now officially available in over 60 markets including its home country, South Korea and the U.S. While in China & India; the devices are available for pre-orders while the sales begin from March 18th. The Galaxy S7 is priced at $695 in the U.S without any contracts while in India it comes with a price tag of $725 (Rs. 48,900). Few days back, the company has announced that more than 1,00,000 units of Galaxy S7 & S7 Edge are sold in the first two days after the sale has started but the company hasn’t released the global sale numbers.

IHS, the research firm has released some interesting data where they mentioned the Bill of Materials (BOM) cost of the US variant of Galaxy S7 with 32GB of storage is just $250 and with the manufacturing cost added, it rises to $255. As we said earlier, the device is available for $695 in the U.S and based on the IHS data Samsung will be earning $440 on every Galaxy S7 sold in the market. For a comparison, the iPhone 6S with 16GB storage is priced at $649 while it costs only $188 to manufacture.

Source: ifixit.com

Talking about the internals of the device, the Snapdragon 820 processor is the most costliest component priced at $62 (Rs. 4,200) and is followed by 5.1-inch Super AMOLED display & 4GB of DDR4 RAM which are priced at $55 (Rs. 3,700) & $25 (Rs. 1,700) respectively. Comparing to the A9 Chip on the latest iPhone 6S & 6S Plus that cost $22, the Snapdragon 820 processor is almost 3X costlier. Coming to the camera, the 12MP rear sensor on this device costs $13.70 (Rs. 900) while the 5MP sensor on the front comes at just $1.95 (Rs. 130).

As seen with the earlier flagships from Samsung, we can also expect some price drops in the next few months. The company has high hopes on Galaxy S7 & Galaxy S7 Edge, which make them stand tall against the Chinese counterparts. In the recently released top Global 500 companies, Samsung has been dropped from second to the third position. The brand value of the company also decreased from $83 billion in 2015 to $81 billion in 2016.

The Galaxy S5 that was launched in 2014 almost costed same as Galaxy S7 to manufacture. The iFixit team also done the teardown of the Galaxy S7 and gave the repairability score as 3 out of 10, which means the device is hard to repair. The cost of R&D, marketing and distribution of the device is not added in the BOM.