It's for several reasons, one is the phones are very expensive. Then, all makers of smartphones keep piece-mealing improvments instead of combining all of what people want most in a phone. I don't understand why this is so hard to do. Great camera, high quality photos in low light, solid specs, great design. Instead we get great camera, but EIS not OIS. Oh, fingerprint on back next to camera, whoops! Oh, waterproof, but camera sucks. Oh wait, software sucks, but fast processor. It's a mess that doesn't have to be.
Listen to your customers. Lower prices. Better specs. Yes, you will turn a profit, and entice people to buy once you do that.