Apple is generating a margin of 55% on each iPhone sold, said US market research company iSuppli. The company performed a teardown analysis on the iPhone is order to find out what is the total hardware bill- of-materials and manufacturing cost.

According to the company, the production of the 8 GB version of iPhone costs around $265.83. Apple sells the phone for $600.

That leaves a profit margin of more than 55 per cent, but does not include costs such as royalties or logistics.

iSuppli said that Infineon Technologies AG (IFX) of Germany is expected to benefit from increased sales of the iPhone. The German company supplies the digital baseband, radio-frequency transceiver and power-management device for the new phone. Infineon's chip content accounts for $15.25 worth of the iPhone's bill-of materials.

But Samsung seems to be the most important supplier for iPhone. "Samsung has $76.25 worth of semiconductor content in the 8-gigabyte version of the iPhone, giving the company a 30.5% share of the product's hardware cost - the largest total of any single supplier," iSuppli said.

The phone's display costs $US27 or about 10.8 per cent of its hardware costs and it was supplied by Germany's Balda AG, iSuppli added.

According to annalists, Apple sold until now close to 500.000 iPhones, but the company didn’t reveal any official estimates.

"Sales of the iPhone kicked off with a bang and iSuppli believes that this strong performance will continue," it said.

The firm forecasts shipments of iPhones to reach 4.5 million units this year and the number to reach more than 30 million by 2011.

Apple began selling two versions of its iPhone late last month. The four- gigabyte model retails for US$499. The company has said it is targeting the sale of 10 million iPhones in 2008.

After iSuppli announced its findings, Apple shares raised $4.42 or almost 4 percent to $125.68 on NASDAQ.