BoM: iPhone 12 Costs 21% > iPhone 11. But Cameras $3.6 cheaper!
- The blended materials cost for the iPhone 12 with 128GB NAND flash is nearly $415, a 21% increase over the iPhone 11.
- But iPhone 12 cameras cost $3.6 less than iPhone 11's
- In the iPhone 12, Apple’s self-designed components including the A14 bionic, PMIC, Audio and UWB chip make up over 16.7% of the overall BoM cost.
- The shift from LCD to OLED in the iPhone 12 is a big jump, resulting in an over $23 cost increase.
- Cost increases are also driven by 5G-related components, with components like 5G modem, transceiver and RF front-end system collectively contributing a $34 increase.
Producing a 128GB iPhone 12 mmWave (millimeter-wave) smartphone will cost Apple up to $431, 26% higher compared to the iPhone 11, according to the latest bill of materials (BoM) analysis by Counterpoint’s component research practice. Despite over $27 cost savings due to the simplified RF design, the BoM cost of the sub-6GHz-only model for overseas markets still increased by 18%.
Assuming a 38% mmWave mix, the blended materials cost for the iPhone 12 with 128GB NAND flash is nearly $415, a 21% increase over its predecessor. Application processor, 5G baseband, display and 5G RF components represent the major areas of the cost increase.
Exhibit 1: iPhone 12 BoM Cost Increase Over iPhone 11
First TSMC 5nm process-powered application processor
The new generation of Apple mobile processors, the A14 bionic, contains a whopping 11.8 billion transistors, up 39% from the A13’s 8.5 billion units. This provides significant performance improvements in aspects of CPU, GPU and Neural Engine. Given the much higher 5nm wafer cost (nearly double that for 7nm), the application processor alone is estimated to introduce a cost increase of over $17. Our analysis also suggests Apple’s self-designed components including the A14, PMIC, Audio and UWB chip make up over 16.7% of the overall BoM cost.
The return of Qualcomm
Qualcomm’s advanced cellular technology found its way back with Apple’s latest launch. Besides the SDX55M 5G baseband, Qualcomm also provides the paired transceivers and RF discrete components for both sub-6GHz and mmWave versions. For the iPhone 12, Qualcomm will be the second-largest electronic component supplier behind Samsung Electronics.
Display upgrade from LCD to OLED
Apple has upgraded the display of its base models to OLED, which supports high dynamic range and higher peak brightness. From the cost perspective, the shift from LCD to OLED in the iPhone 12 is a big jump, resulting in an over $23 cost increase. Both Samsung Display and LG Display are set to supply more panels to Apple.
Increased cost to enable 5G
The iPhone 12 has been equipped with more RF components to support the 5G-related spectrum. Our analysis shows the blended cost increase from the RF subsystem is around $19. Besides Qualcomm, other major content gainers are Skyworks, MURATA and Avago.
Diversified sources of supply
Apple has managed to diversify its supply sources. For the iPhone 12, the memory orders are split between industry leaders, with Samsung and KIOXIA (Toshiba) supplying NAND flash, and SK Hynix and Micron supplying LPDDR4X. The camera content shares are largely gained by Sony, LG Innotek and Sharp. NXP and Broadcom continue providing solutions for wireless connection and display/touch control. Cirrus Logic, Goertek, Knowles and AAC dominate the audio design. TI and ST are major suppliers of power and battery management IC. Apple has also expanded its cooperation with ASE/USI, leveraging the latter’s SiP (System in Package) packaging technology to miniaturize the design.
Originally published at https://www.counterpointresearch.com on January 5, 2021.