Cost of Face ID sensors
Was only a problem during the initial ramp up of the iPhone X last year, due to low yields. Once those problems were solved, it became a non-issue - which is why Apple was able to offer it on the cheaper iPhone XR. The big cost difference between the XS and XR is the OLED display with 3D touch layer.
They'll likely keep selling the XR next year for $100 less than today, just like they are selling the iPhone 8/8S now for $100 less than they were a year ago.