Apple Makes 55 Percent Profit on New iPhone Says iSuppli

Market Intelligence Firm iSuppli ripped a brand new iPhone apart and, after having conducted a thorough analysis of its innards, have estimated that it costs Apple only USD 173 to build.

That's USD 50 less than the initial 8GB iPhone version one based on a previous iSuppli estimate, which is surprising given the fact that Apple has added even more features - including 3G capability and GPS.

This is partly due to the fact Apple has used most of the original components except for a few ones like the Infineon chip which includes a dual ARM926 and ARM7 microprocessor cores and provide with the HSDPA/WCDMA/EDGE capability.

Apple sells the handset in the US for USD 199 and according to sources, AT&T is said to provide a USD 300 subsidy for each contract signed, effectively bringing the price of an iPhone 3G to USD 499.

The tally though does not take into consideration the fact that Apple has to pay roughly USD 50 per iPhone shipped in terms of royalty for Intellectual Property used in the device.

iSuppli also found out that the motherboard used in the new iPhone is a single PCB rather than two as previously used; furthermore, the battery is not soldered in the new version which makes servicing easier.