Apple’s iPad only costs $270 to make, says analyst
Although that $499 entry-level iPad is pretty much affordably by everyone, Apple will still be making a rather sizable profit on each one, if a bill-of-materials (BOM) breakdown conducted by BroadPoint AmTech analyst Marshall is to be trusted.
According to the BOM, the low-end $499 iPad only costs $270 to make, with the 9.7-inch touch-sensitive display being the most expensive element at around $100, with the 16GB SSD and aluminum case each costing only about $25.
As the storage jumps, so do Apple’s profits: the 32GB and 64GB iPads only see their costs rise another $25.50 and $76.50, respectively, but their suggested prices go up $100 and $200.
Apple’s most profitable BOM item? The 3G radio: it only costs them $16, but Apple’s charging over $130 for it. I personally wonder if some of that mark-up might be shared with AT&T to compensate them for assumed profit losses related to the month-by-month, cancel-anytime iPad 3G deal, but either way, Apple’s charging a premium for the functionality.
It’s all an estimate, of course — no one will know the iPad’s true cost until it’s actually vivisected after launch — but Apple knows how to put together a high-quality product that is both extremely profitable and an extremely good value. I wouldn’t be surprised if these numbers were exactly right.
John Brownlee is Cult of Mac's Deputy Editor. He has also written for Wired, Playboy, Boing Boing, Popular Mechanics, VentureBeat, and Gizmodo. He lives in Boston with his girlfriend and two parakeets. You can follow him 
