Galaxy S20 Ultra is expensive: Samsung makes so much money on every phone

Market researchers determine production costs

The Samsung Galaxy S20 Ultra retails for around € 1,400, but cellphone production is significantly cheaper for manufacturers. A study by TechInsights market researchers showed us how much Samsung can make on each phone.

TechInsights market researchers have broken the Samsung Galaxy S20 Ultra into individual parts and estimated part costs. According to this, the phone brings the production cost of South Korean manufacturers close to $ 530. That's less than half the $ 1400 retail price. Compared with the previous Galaxy S10 5G, the selling price has increased by $ 100, but the production cost has only increased by 58 euros.

As a result, profit margins are high for every Galaxy S20 Ultra sold. Samsung is no exception. Generally speaking, the production cost of top smartphones is almost one-third of its selling price-a further analysis by TechInsights shows. Xiaomi's Mi 10 is an exception. Xiaomi has repeatedly publicly emphasized that the company's goal is only a 5% profit margin. For Apple, Samsung and Huawei, this should be higher.

Samsung Galaxy S20 series in pictures

However, it should be mentioned that the calculation of "sales price minus production costs" ignores other cost factors. In addition to the production costs of the Samsung Galaxy S20 Ultra, there are also research, marketing, sales and company costs. They are difficult to measure and vary by manufacturer.