Techinsights has published its teardown review of Xiaomi‘s flagship Mi 10. The review included an analysis of the cost of the components onboard the device. The teardown was carried out on the topmost 12GB + 256GB variant of the Mi 10 which has a price tag of 4699 yuan ($673).

The analysis led to the estimation that the Mi 10’s components cost around $440 (~3088 yuan). That may look outrageously low for a device that has an official retail price of 4699 yuan ($673) and may even sell for higher than the official price of third-party stores. However, we must point out that the production cost of a smartphone isn’t reliant on the components cost only.

Xiaomi’s Chairman Lei Jun had made this clarification several years back when he disclosed in 2012  the factors that determine the actual production cost of smartphones. The factors include component procurement costs, various taxes, foundry processing costs, production losses, research and development costs, after-sales, sales costs, Qualcomm patent fees, company operating costs, and others.

The Mi 10 is still relatively a cheap phone if we are to compare the production cost with those of some flagship models. For instance, the Bill of Material for the iPhone 11 Pro Max shows that the 512GB version components costs around $490.5. In comparison, the device is sold in China for 12,699 yuan (around $1,800).

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