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Samsung’s Galaxy S7 build costs at $255, IHS says

The Galaxy S7 and Galaxy S7 edge are the new kids on the market, with the devices appearing to match those of last year but with some remarkable changes under the hood. Often, Samsung’s devices are stacked up against the iPhone, with Apple being Samsung’s most fierce rival in terms of sales. A new report shows that some have had time to take apart the Galaxy S7 to maintain a list of the parts and the pricing behind the ordinary Galaxy S7 (not the S7 edge, mind you). The price? Analyst firm IHS says that the Galaxy S7 costs $255 to build.

The Galaxy S7’s $255 bill of materials (or BOM), however, takes into account the $6 manufacturing cost (the parts alone are $249.05 alone) but does not include R&D for Samsung’s software and software engineering that produced the Galaxy S7. The device itself retails for at least $670 in the US, with Samsung racking up $415 additional profit. As said above, however, not all of the $415 additional profit per device goes to Samsung: the Galaxy S7 features Qualcomm’s quad-core Snapdragon 820 processor, which costs $62 alone and is 25% of the total cost of the device.

Samsung decided to place a better 12MP sensor (worth $13.70) into the Galaxy S7 this year, a sensor that is none other than a Sony IMX260 (which, not being Samsung’s, still mandates the loss of profit). Samsung did use its own LSI sensors in both front and rear-facing cameras in the Galaxy S7, but it depends on the region and country in which you live. Additionally, Samsung used Dual Pixel technology to create a multiphase detection autofocus (or PDAF), which brings the Galaxy S7 to rival DSLR cameras used by professionals in the field of photography.

Samsung used its same AMOLED touchscreen panel for the Galaxy S7 as it did the Galaxy S6, with the display costing $55, the flash memory in the device (UFS 2.0, to be exact) costing $7.25, the LPDDR4 RAM made by Hynix (not Samsung, as was the case with the Galaxy S6 and S6 edge) costing $25, and the sensors (gyroscope, fingerprint sensor, compass, optical pulse sensor, accelerometer, etc.) costing $4.65 combined. The cost of the Galaxy S7 edge, utilizing Samsung’s own R&D on the edge trademark design, not to mention its software created specifically for the edge, mandates additional costs — but, as we said, IHS did not provide a BOM for the S7 edge (only its non-edge sibling).

Teardowns and price assessments are always “guesstimates,” and the same can be said here. At the same time, however, it just goes to show that displays, processors, RAM, and cameras all cost a pretty penny when it comes to providing the best smartphones on the market. When you factor in Samsung’s software features and how it works hard to set itself apart from the rest of the Android OEMs, the $670 price tag for the Galaxy S7 (and $100 to $120 more expensive for the Galaxy S7 edge), the price tag is justified. And, we can’t forget: the CPU cooling system brings an additional cost, too.

The Galaxy S7 and S7 edge are now available for sale worldwide, having been on the market for 5 days now (since March 11th). Both feature the best smartphone cameras on the market, with even long-time Apple journalists arguing that Samsung’s cameras are superior to those in the iPhone. Verizon has also ushered in an Annual Upgrade Program whereby Galaxy S7 and S7 edge buyers/leasers can get a new Samsung Galaxy smartphone each year, provided that at least 50% of the device cost is paid off at the time of the upgrade.

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