Apple’s newest iPad mini was announced a little over a week ago. The 7.9-inch tablet has gotten great reviews for being beautiful and having a great eco system. There’s not a lot to dislike about the iPad Mini, but if there was something to nitpick, it would be the $329 price tag for the base model. But how much exactly does it cost Apple to make one unit?
The folks over at IHS iSuppli stripped apart the 16GB version of iPad Mini and found out some interesting facts. Calculating individual costs of each material and adding it up makes the price of the iPad Mini $188. Taking into consideration the $329 price tag means Apple earns a healthy 43% gross margin. Profit margin for the 32GB and 64GB version is 52 percent and 56 percent respectively. The 7.9-inch display and corresponding parts total at $80.
The 43% margin might sound a lot considering the likes of Amazon or Google just break even on their tablets. But Amazon and Google have the service part of their products where they make up for the lack of any margin on hardware. In addition to that the 43% doesn’t include the countless man hours spent and the millions spent on R&D prior to product launch.