Case 5:19-cv-00036-RWS Document 66-42 Filed 08/27/19 Page 1 of 16 PageID #: 3503
`Case 5:19-cv-00036—RWS Document 66-42 Filed 08/27/19 Page 1 of 16 PageID #: 3503
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`Case 5:19-cv-00036-RWS Document 66-42 Filed 08/27/19 Page 2 of 16 PageID #: 3504
`8/22/2019
` iPhone X: This is how much it costs to make one, in components | ZDNet
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` iPhone X: This is how much it costs to make one, in
`components
`Apple's new flagship phone retails at $999, but how much do the components
`add up to?
`
`By Steve Ranger | November 9, 2017 -- 14:37 GMT (06:37 PST) | Topic: Innovation
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`Case 5:19-cv-00036-RWS Document 66-42 Filed 08/27/19 Page 3 of 16 PageID #: 3505
`8/22/2019
` iPhone X: This is how much it costs to make one, in components | ZDNet
`Engineers at IHS Markit have taken the new iPhone X (https://www.zdnet.com/article/first-impressions-of-
`
`apples-iphone-x/) to pieces and have concluded that, for the 64GB version, the cost of materials
`
`comes in at around $370 (http://news.ihsmarkit.com/press-release/technology/iphone-x-costs-apple-370-
`
`materials-ihs-markit-teardown-reveals).
`
`The research company said its "preliminary physical dissection" of the A1865 model of the iPhone
`●
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`X with 64GB of internal storage -- which retails for $999 -- shows that it carries a bill of materials
`
`of $370.25.
`
`In contrast, Samsung's Galaxy S8 with 64GB of storage costs $302 in materials and retails at
`
`around $720.
`
`Andrew Rassweiler, senior director of cost benchmarking services at IHS Markit, said the screen of
`
`the iPhone X and its TrueDepth sensing system contribute to its higher cost.
`
`The most talked-about feature of the iPhone X is Face ID, a facial recognition system that replaces
`
`Touch ID fingerprint recognition. This is built around the TrueDepth camera, which is housed in the
`
`black notch at the top of the handset and uses an infrared camera to project more than 30,000
`
`invisible dots to map the user's face.
`
`Jérémie Bouchaud, senior director for MEMS and sensors at IHS Markit, said Face ID is a complex
`
`assembly that uses components from many suppliers, although the basic functionality is similar to
`
`Microsoft's Kinect sensing system, which used a flood illuminator, dot projector and infrared
`
`camera.
`
`The teardown of the iPhone X revealed that its IR camera is supplied by Sony/Foxconn while the
`
`silicon is provided by ST Microelectronics. The flood illuminator is an IR emitter from Texas
`
`Instruments built on an application-specific integrated circuit (ASIC) and single-photon avalanche
`
`diode detector from ST Microelectronics. Finisar and Philips manufacture the dot projector. IHS
`
`Markit puts the hardware cost of the TrueDepth sensor cluster at $16.70.
`
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`Case 5:19-cv-00036-RWS Document 66-42 Filed 08/27/19 Page 4 of 16 PageID #: 3506
`8/22/2019
` iPhone X: This is how much it costs to make one, in components | ZDNet
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`"The assembly and testing of the TrueDepth system and its individual components is challenging
`
`and likely a factor in the production delays," Bouchaud said. "For instance, the assemblage and
`
`test of the Texas Instruments and ST Microelectronics subsystem for the flood illuminator is far
`
`from trivial and requires a high number of test equipment pieces."
`
`Another big cost is the 5.85-inch 19.5:9 aspect ratio AMOLED display on the iPhone X. IHS Markit
`
`estimates the cost of the display module, which includes the cover glass, AMOLED panel and
`
`Force Touch sensor, at $110 -- almost a third of the total hardware cost.
`
`IHS Markit said it thinks that Apple is maintaining its typical hardware margins for the iPhone X, but
`
`said "that gross margin may increase over time as manufacturing yields improve". The $370
`
`doesn't include a number of costs such as research and development, marketing or
`
`manufacturing.
`
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`Case 5:19-cv-00036-RWS Document 66-42 Filed 08/27/19 Page 5 of 16 PageID #: 3507
`8/22/2019
` iPhone X: This is how much it costs to make one, in components | ZDNet
`According to HIS Markit, Apple's iPhone 8 Plus has a bill of materials cost of $288
`(https://www.zdnet.com/article/apple-iphone-8-plus-costs-295-44-to-make-says-ihs-markit/).
`
`Read more on the iPhone X
`
`First impressions of Apple's iPhone X (https://www.zdnet.com/article/first-impressions-of-apples-iphone-
`●
`MENU
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`
`x/)
`
`Caseology case roundup for the Apple iPhone X: Stylish drop protection for less than $15
`
`(https://www.zdnet.com/pictures/caseology-case-roundup-for-the-apple-iphone-x-stylish-drop-protection-for-
`
`less-than-15/)
`
`Best Qi wireless chargers: Charge up your iPhone X and iPhone 8
`
`(https://www.zdnet.com/pictures/best-qi-wireless-chargers-for-iphone-x-iphone-8-plus/)
`
`Phone X display is the best: Made by Samsung, improved by Apple
`
`(https://www.zdnet.com/article/iphone-x-display-is-the-best-made-by-samsung-improved-by-apple/)
`
`iPhone X: We can reduce but not eliminate burn-in on OLED screen, says Apple
`
`(https://www.zdnet.com/article/iphone-x-we-can-reduce-but-not-eliminate-burn-in-on-oled-screen-says-apple/)
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