Many companies featured on Money advertise with us. Opinions are our own, but compensation and
in-depth research determine where and how companies may appear. Learn more about how we make money.

Advertiser Disclosure

The purpose of this disclosure is to explain how we make money without charging you for our content.

Our mission is to help people at any stage of life make smart financial decisions through research, reporting, reviews, recommendations, and tools.

Earning your trust is essential to our success, and we believe transparency is critical to creating that trust. To that end, you should know that many or all of the companies featured here are partners who advertise with us.

Our content is free because our partners pay us a referral fee if you click on links or call any of the phone numbers on our site. If you choose to interact with the content on our site, we will likely receive compensation. If you don't, we will not be compensated. Ultimately the choice is yours.

Opinions are our own and our editors and staff writers are instructed to maintain editorial integrity, but compensation along with in-depth research will determine where, how, and in what order they appear on the page.

To find out more about our editorial process and how we make money, click here.

By Alicia Adamczyk
September 26, 2016
Tomohiro Ohsumi—Getty Images

The market price for a 32GB iPhone 7 is $649, yet the phone reportedly costs Apple just $225 to build.

That’s according to a new report from IHS Markit, which found the materials cost around $219.80, plus an additional $5 to assemble. That makes the consumer price about three times greater than Apple’s production cost, and $36.89 more than the 6S model.

Andrew Rassweiler, senior director of cost benchmarking services for IHS Markit, said that this is actually the smallest margin he’s seen on an iPhone in recent years—but that Apple continues to make more off its hardware than its chief competitor, Samsung.

Read Next: The iPhone 7 Is Here. Is It Worth the Upgrade?

Quartz notes that this is the second most expensive phone Apple has ever produced, including the original iPhone (the 6S Plus being the priciest). The price increase can be attributed to a brighter display, larger battery, and upgraded storage—this is the first iteration of the iPhone that boasts 32GB of memory in its base model.

IHS has not yet run calculations on the iPhone 7 Plus.

Advertiser Disclosure

The purpose of this disclosure is to explain how we make money without charging you for our content.

Our mission is to help people at any stage of life make smart financial decisions through research, reporting, reviews, recommendations, and tools.

Earning your trust is essential to our success, and we believe transparency is critical to creating that trust. To that end, you should know that many or all of the companies featured here are partners who advertise with us.

Our content is free because our partners pay us a referral fee if you click on links or call any of the phone numbers on our site. If you choose to interact with the content on our site, we will likely receive compensation. If you don't, we will not be compensated. Ultimately the choice is yours.

Opinions are our own and our editors and staff writers are instructed to maintain editorial integrity, but compensation along with in-depth research will determine where, how, and in what order they appear on the page.

To find out more about our editorial process and how we make money, click here.

EDIT POST