AfterDawn: Tech news

Moto G teardown reveals thin margins for Motorola

Written by Andre Yoskowitz (Google+) @ 08 Dec 2013 10:22

Moto G teardown reveals thin margins for Motorola Earlier this week we reviewed the excellent and cheap Motorola Moto G smartphone, which retails for $179 (8GB) or $199 (16GB) unlocked and off-contract.
A new teardown of the powerful device reveals that the components within the 16GB model cost Motorola about $123, leaving thin margins for its maker, especially when compared to high-end devices like the iPhone 5S, HTC One and Samsung Galaxy S4.

At $123 for component costs, and including expected costs for R&D, marketing and shipping (along with operating expenses), Motorola makes under $10 per unit sold, razor thin margins. By comparison, Samsung has about a 28 percent margin on its S4, and Apple has a 31 percent margin on its iPhone 5S.

Posted below is a picture of the component costs for the more expensive devices, which have a cost of materials at about $210, just $90 more than the Moto G. Off-contract, those devices sell for $650.

Motorola CEO Dennis Woodside has long said rival smartphones are just too expensive: "The way I see it is there is massive demand and the market isn't satisfying that demand."

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