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Samsung’s latest flagship phone costs more to build than the previous model after the company upgraded the device’s camera, according to Bloomberg, citing research firm TechInsights.
The new Galaxy S9+ smartphone cost $379 to build, up from $343 for last year’s Galaxy S8+, TechInsights estimated. The S9+ has a more advanced camera system that includes a second rear camera. Those components cost $48 versus $32 on the S8+. As smartphone cameras have improved enough to be the go-to picture-taking devices for most people, photo quality has become a major battleground between mobile technology companies.
"When you look at the camera sensors, Samsung took the higher-performing 12 megapixel sensor from the Note 8 in addition to the 12 megapixel sensor on the S8+, and combined those for the S9+ camera module," TechInsight’s Al Cowsky said. "They’re incrementally improving things.
The other key phone technology battleground is the display, although here costs declined. The most expensive component inside the S9+ is the 6.2-inch OLED screen, which comes in at $72.50. That’s cheaper than the similarly sized screens in the Note 8 and S8+, which cost $82 and $78.50, according to the analysis. This is followed by the main phone processor coming in at $68 and memory components at $51.
The analyzed phone uses a Samsung-designed processor, while Samsung models in the U.S. have historically used Qualcomm processors. The device TechInsights took apart includes Samsung’s Exynos 9810 chip, which has a new modem that’s potentially faster than last year’s models.
The average U.S. price of the S9+, through wireless carriers, is $903.30, suggesting Samsung has a 58 percent gross profit margin after the costs estimated by TechInsights. The company also sells the device on its website for $840, which would result in a 55 percent margin.
That compares to 61 percent estimated margins for Apple’s iPhone X, and 59 percent margins for the iPhone 8 Plus, according to TechInsight’s analysis. A teardown on the smaller S9 model wasn’t conducted.