Apple Still Making a Killing on New iPad's Pricier Hardware

For those of you who lay awake at night tossing and turning as you try to figure out whether Apple can afford to sell its new iPad models at the same price points as the iPad 2, you can rest easy knowing the Cupertino company is still making a profit on hardware. And a hefty one at that. IHS iSuppli completed its teardown analysis of the new iPad and figured out that it costs between $306.05 (16GB Wi-Fi) and $397.95 (64GB Wi-Fi + 4G) to build the new tablets.

Here's how it breaks down:
  • iPad 16GB Wi-Fi: $306.05 to build, sells for $499 ($192.95 difference)
  • iPad 32GB Wi-Fi: $322.85 to build, sells for $599 ($275.15 difference)
  • iPad 64GB Wi-Fi: $356.45 to build, sells for $699 ($342.55 difference)
  • iPad 16GB Wi-Fi + 4G: $347.55 to build, sells for $629 ($281.45 difference)
  • iPad 32GB Wi-Fi + 4G: $364.35 to build, sells for $729 ($364.65 difference)
  • iPad 64GB Wi-Fi + 4G: $397.95 to build, sells for $829 ($431.05)

Those numbers include $10.75 for manufacturing costs, and as you can clearly see, Apple's making a tidy profit on each device. Higher end models are more lucrative for Apple to sell, culminating in a $431.05 difference between the selling price and bill of materials (BOM) for a 64GB iPad Wi-Fi + 4G.

Not surprisingly, the Retina display is the most expensive part and runs $87 a pop, compared to $57 for the display used in the iPad 2. The A5X processor is also slightly more expensive and runs $23 compared to $14.20 for the A5 chip. Another big difference between the two generations is the upgraded 5MP iSight camera in the new iPad, which along with the FaceTime camera adds $12.35 to the BOM compared $4.10 for the crappy cameras used in the iPad 2.

Is it worth it? Stay tuned: We'll answer that question and more in an upcoming review of the new iPad.

Via:  IHS iSuppli

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