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iPad Air costs Apple $274 to make, has fatter profit margin than the iPad 4

0. phoneArena 05 Nov 2013, 08:20 posted on

Research firm IHS iSupply has torn down the new Apple iPad Air, providing valuable insight into the components cost breakdown. Its full report is not due until a few weeks from now, but for the time being it lets us know that the iPad Air starts off at $274 for Apple. This makes it actually cheaper to produce than the previous generation, despite the ultra thin and light machined aluminum design...

This is a discussion for a news. To read the whole news, click here

posted on 05 Nov 2013, 09:12 8

1. Long1 (banned) (Posts: 399; Member since: 18 May 2013)


So again Samsung device with Apple logo on it. Right?
Only the cheap tin-can comes from Apple.

posted on 05 Nov 2013, 09:20 4

3. Ninetysix (Posts: 1468; Member since: 08 Oct 2012)


You sound upset brosephine. Must suck getting bullied by Apple while growing up.

posted on 05 Nov 2013, 10:48 1

9. androiphone20 (Posts: 1399; Member since: 10 Jul 2013)


Bwaaaaaahhhh-da bang-da bang-diggy-diggy-diggy Said the boogie-said up jump the boogie

posted on 05 Nov 2013, 10:49 1

10. androiphone20 (Posts: 1399; Member since: 10 Jul 2013)


Bwaaaaaahhhh-da bang-da bang-diggy-diggy-diggy Said the boogie-said up jump the boogie

posted on 05 Nov 2013, 10:49 1

11. androiphone20 (Posts: 1399; Member since: 10 Jul 2013)


Bwaaaaaahhhh-da bang-da bang-diggy-diggy-diggy Said the boogie-said up jump the boogie, +1

posted on 05 Nov 2013, 09:13

2. ihavenoname (Posts: 1319; Member since: 18 Aug 2013)


Premium product, premium pricing.

posted on 05 Nov 2013, 09:26 1

4. appleDOESNT.com (Posts: 423; Member since: 19 Nov 2011)


or sell it for $349 put it in every home in the world just about. Destroy the competition and still make 75 bucks profit. ya, stupid i know. $500-900 for iPads after 5 of them without a single price job is not premium, it's stupid. It's dThey'd own 90% market share and still make profit, what a schmuck i am for thinking this way.

posted on 05 Nov 2013, 10:32 5

7. asulect (Posts: 131; Member since: 27 Aug 2012)


The $349 is only the material cost. There's still a whole sea of other costs that are not included into it. ie, Labor cost to assemble the product, packaging cost, shipping cost, sales cost, Marketing cost, research and development cost, warranty cost, unsold inventory cost, etc...

If the mathematics is that simple, then companies like Nokia, HTC and blackberry can never lose money. The raw material cost to make an HTC or Nokia or Blackberry phone is definitely less than what they charge per phone, why losing massive amount of money?

posted on 05 Nov 2013, 10:43 1

8. Finalflash (Posts: 1576; Member since: 23 Jul 2013)


Actually you would be a smhmuch for thinking that way. They make like 200 off that thing and then some for higher models. If they were to make only 75, theyd have to sell at least $500 worth of apps per tablet to make the remainder up. Then they would also dilute their brand and it would be more costly to produce. Finally it would not guarantee that the rest of the plastic makers would not undercut and reduce it all together.

posted on 05 Nov 2013, 18:23 1

27. appleDOESNT.com (Posts: 423; Member since: 19 Nov 2011)


Apple has enough hands in pots to do great without rape margins on hardware. They get a piece of everything in and out of iOS. I get the apple high margins when they were a premium product. Macs were a step up fo sure. iOS devices are just your average consumer products. No reason to pretend they are worth more and their margins are deserved. They aren't but ya know what? iPad would dominate the market beyond your iClone wildest dreams if they lowered closer to the competition. Then once they own the market, I am sure they would be doomed! omg, what would they ever do to make money. How bout 30% of everything goin in and out of iOS. You fool appledoesnt, you make no sense! I want apple to charge me more for less, it just makes me feel better!!! :/

posted on 05 Nov 2013, 11:15 1

14. stealthd (Posts: 929; Member since: 12 Jun 2011)


Yeah, you are a schmuck. They'd be digging a hole they can't clime back out of. Prices would go down and they would have to stay down, because who's going to spend more once they lower the price? Lower prices, lower margins, lower revenue, lower profits, lower stock price. But at least they'd have market share. Really a win-win right?

posted on 05 Nov 2013, 11:31

15. Finalflash (Posts: 1576; Member since: 23 Jul 2013)


True dat.

posted on 05 Nov 2013, 18:13

26. appleDOESNT.com (Posts: 423; Member since: 19 Nov 2011)


other companies sell for slim margins, kindle was given away for a loss. Apple has their hands in enough pots to stop raping their iFollowers. Yet, they rape a little more each yesar with S hit after S hot. Xbox 360 was $175 in the whole on launch day. $75 profit is higher than most companies ever make and you guys applaud the $225-$500 Apple margins. Pathetic. Each year the iPad is the same thing albeit it a little thinner, a little faster and a little cheaper, yet the price has never gone down when it is over priced in the first place. What electronics do that, none. Well none but greedy, pathetic, iClone lovin, do no wrong even when getting price raped, apple

posted on 05 Nov 2013, 19:52

29. ardent1 (Posts: 1991; Member since: 16 Apr 2011)


None the stuff you said makes any sense. These are willing buyers of Apple products.

We don't want to buy junk. With Apple products, we get a fair price (as measured by depreciation expense), products that hold their value, customer support at Apple stores (if we need it), legendary build quality (compare to its competitors), highly polished and really aesthetically attractive design and material.

Apple pays attention to the details. Their devices work.

posted on 05 Nov 2013, 19:46

28. ardent1 (Posts: 1991; Member since: 16 Apr 2011)


Apple does not want market share. They want to build great products.

If you want a $79 7" tablet, you can find it at Walmart. For $50 more, you can get the Hi-Sense tablet with a better display and a better processor.

Or, take my recommendation and buy the Nook 7" tablet that are going for under $100 in some places. That is a good tablet for the price.

The market is flooded with junk tablets. And many of the manufacturers are leaving because they can't compete in the low price tablet environment. Adios BN, it was nice knowing you.

posted on 05 Nov 2013, 21:13 1

32. appleDOESNT.com (Posts: 423; Member since: 19 Nov 2011)


$349 is not $79. Bullcrap on the premium bs. They are consumer tablets and in a area where they would destroy all competition by simply lowering their profit margins, you guys are raw raw profit margins, go apple in your way of thinking. Fine, $399, it's been 5 iPads, prices go down to make it, it's time the profit margin went down a bit to. oh my, iFollowers deserve the ripoff apple is

posted on 05 Nov 2013, 09:28

5. Finalflash (Posts: 1576; Member since: 23 Jul 2013)


Oh god no, please don't say it has IGZO. That was supposed to be the dream screen battery saving tech...its supposed to be 60% more battery life. Don't tell me it was all a lie.

posted on 05 Nov 2013, 10:00

6. _Bone_ (Posts: 2106; Member since: 29 Oct 2012)


The Air has twice as fast HW, 20% less battery and more battery life. There's a good chance the screen reached 30-40% more efficiency, which it outstanding leap in the tech world.

posted on 05 Nov 2013, 10:54 2

12. Finalflash (Posts: 1576; Member since: 23 Jul 2013)


Not really, the twice as fast thing is at a very power conservative process so that barely takes more than the last generation as the iPhone 5s showed. The battery life is the same as last year as shown by every review. Display is more frugal than last time, but not by 40-60% as shown by not that much batter being saved. Nothing else changed and the OS was improved to save more battery, so I don't see the IGZO advantage here.

posted on 05 Nov 2013, 11:45

16. Taters (Posts: 2661; Member since: 28 Jan 2013)


Igzo allows you to make it thinner basically. The battery life is just a marketing gimmick.

I don't know if I can find it but there was one article that said Samsung licenced some igzo tech for the Nexus 10 so this isn't the first.

posted on 05 Nov 2013, 14:17

17. Long1 (banned) (Posts: 399; Member since: 18 May 2013)


Samsung even own a share of IGZO.

posted on 05 Nov 2013, 15:06

19. Finalflash (Posts: 1576; Member since: 23 Jul 2013)


They own a chunk of Sharp now so they do, but they don't have any full IGZO in anything right now. The only thing that does is some random phone in Japan by Sharp themselves, but that wasn't anything to compare off of though. Regardless, I don't think IGZO is on this iPad because they said they wouldn't have full scale production for IGZO in place until Q1 next year. At the volume the iPads sell, I doubt they'll have enough screens a quarter ahead of time.

posted on 05 Nov 2013, 11:10 3

13. marchels14 (unregistered)


Big $ for Apple 361$ to make but 929$ to sell, I understand there is marketing profit and other expenses,but I think its bit too much to ask for from customers. I don't care about premium design, but this is just a way to empty our pockets.

posted on 05 Nov 2013, 14:35

18. donfem (Posts: 520; Member since: 30 Mar 2011)


+1 to this.

posted on 05 Nov 2013, 19:54

30. ardent1 (Posts: 1991; Member since: 16 Apr 2011)


Then start your own company making tablets since you are so damn smart.

posted on 05 Nov 2013, 15:59 2

20. gallitoking (Posts: 4684; Member since: 17 May 2011)


it's call brand recongnition... that's why Coach can sell you a womans purse for 500+ dollars and Christian Dior a belt for 349.99... yes a belt for 349.99..

posted on 05 Nov 2013, 16:09 1

21. tedkord (Posts: 4489; Member since: 17 Jun 2009)


Ugh. My wife has an affinity for Coach purses. It drives me nuts that she will pay $400 for a goddamned bag.

But that is an analogy I've made before. She doesn't buy them because they do more than another bag, or because the are better than other bags. She buys them because they have a known name (at least among purse buyers), and other women will see and recognize that brand.

posted on 05 Nov 2013, 16:15

23. gallitoking (Posts: 4684; Member since: 17 May 2011)


yes my wife is the same and shoes..wow.. they charge like they are made by angels... but anything for the wifey...

posted on 05 Nov 2013, 16:19 1

24. darkkjedii (Posts: 10416; Member since: 05 Feb 2011)


Ted don't mention your wife dude, Xperiadroid will go nuts, and flame in you lol. He's let me know, I can no longer say wife, mini 2, line up, or bring it on apple. If I do, I'll incur his wrath. BTW with my wife it Michael Khors (spell check please). Oops Xperia my bad, I meany my "life".

posted on 05 Nov 2013, 16:15 1

22. darkkjedii (Posts: 10416; Member since: 05 Feb 2011)


About time someone stepped in with some reality. Everyone's dogging apple for doing what all these big popular well known companies do. Build low sell high, it's called capitalism. +1 dude. Get money apple, I've got some for you to take when the mini2 drops.

posted on 06 Nov 2013, 16:42

34. quakan (Posts: 1156; Member since: 02 Mar 2011)


I don't get some of the commenters on here thinking that Apple is committing a crime by following suit of other premium brands. Their overwhelming dislike for Apple makes them think nonsensically.

posted on 05 Nov 2013, 16:38 1

25. poddercast (Posts: 2; Member since: 05 Nov 2013)


Apple seems to WANT to loose their lead in tablets to Android. If they learned to make the iPad cheaper then why not drop the price to go with that. Hypothetically, if Apple had adopted market trends with the smartphone market like bigger screen, you think half the people would have bought a Galaxy? Android phones offered what iPhone could offer but Apple chose not to include it. And now they are doing the same with tablets.

posted on 05 Nov 2013, 19:57

31. ardent1 (Posts: 1991; Member since: 16 Apr 2011)


And point you are missing is android OEMs (with the exception of Samsung who is a copyist) do not make money as measured by economic profit or ROIC.

Making larger screens was just another money losing gimmick for these android OEMs.

posted on 06 Nov 2013, 05:09

33. Dexxter (Posts: 10; Member since: 04 Nov 2013)


does this include the cost of the battery???

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