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It costs Apple (NASDAQ:AAPL) about $316 to make one new iPad, according to a team of analysts from the market research firm IHS iSuppli. The team was among those who tore into the new iPad after its release on Friday to estimate how much it cost to build.
The IHS iSuppli analysts, who are respected by the investment community for their tear-down expertise, tore apart a new iPad they picked up at a Southern California store and discovered that the 16-gigabyte, Wi-Fi-only iPad that sells for $499 costs an estimated $316 to make, or about 63 percent of the device’s selling price. The company makes a bit more profit from the 4G-ready 64-gigabyte model that retails for $829 — it costs about $409 to make, or about 49 percent of the retail price. The new cost shows an increase from the iPad 2 of between 21 percent and 25 percent, depending on the model, from the iPad 2, the analysts said.
IHS iSuppli also reported that many of the suppliers – including Qualcomm (NASDAQ:QCOM), Broadcom (NASDAQ:BRCM), TriQuint Semiconductor (NASDAQ:TQNT), STMicroelectronics (NYSE:STM) and Cirrus Logic (NASDAQ:CRUS) — stayed the same from the last iPad model. “It’s most of the same characters we saw last time around,” said analyst Andrew Rassweiler, according to All Things D.
Also, the components from Taiwanese companies TPK, Wintek and Chi Mei that drive the central interface feature of the new iPad’s touchscreen capabilities have remained essentially the same, although Rassweiler said he expects to see a big change in this area in future iPads.
One thing that was notably different was the high-end Samsung display, which reportedly has more pixels than HDTV. Rassweiler estimates that the display cost $87 on the latest iPad compared with $57 on the iPad 2. According to Rassweiler, LG Display (AMEX:LGL) and Sharp Electronics also have deals with Apple to supply displays for the latest iPad, and displays may cost as much as $90 each depending on the vendor.
Another part that’s pricier on this model is the battery, which is estimated to have set Apple back $32, up from $25 on the iPad 2. But Rassweiler notes that it is a big upgrade, boasting 70 percent more capacity than previously, and lower prices in the lithium polymer material used to make the battery offset the cost of providing a far superior battery.
The combined cost of the front-facing and back cameras is $12.35, which is more than three times the cost of cameras found on the iPad 2, said Rassweiler. But it’s nearly the same setup as the camerals on the iPhone 4. The camera supplier was unclear because they make every effort to keep identifying information hidden from teardown analysts. However, likely suspects include Omnivision (NASDAQ:OVTI) and Largan Precision Co., a Taiwanese supplier of camera modules to wireless phone companies. As with other Apple devices, the main processor chip is an Apple-made A5X processor, one manufactured under contract by Samsung. The estimated cost of that chip is $23, up from $14 on the iPad 2.
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