The new iPad, equipped with 32 Gigabytes (GB) of NAND flash memory and 4G Long Term Evolution (LTE) wireless capability, carries a bill of materials (BOM) of USD $364.35. When the $10.75 manufacturing costs are added in, the cost to produce the new iPad rises to $375.10. The BOM of the 16GB 4G LTE version amounts to $347.55, and the 64GB version is estimated at $397.95.
The $364.35 BOM represents 50 percent of the $729.00 retail price of the 32GB LTE version of the new iPad.
The very lowest-end version of the new iPad, with 16GB memory and no LTE, carries a combined BOM and manufacturing cost of $316. The highest-end model, with 64GB memory and integrated LTE, has a total BOM and manufacturing expense of $408.70.
The new iPad is more expensive to produce than the iPad 2 at the time of product launch, even though the retail price points are the same. The 32GB LTE model’s BOM is nearly 9 percent higher than an iPad 2 equipped with 32GB and 3G wireless, which carried a cost of approximately $335 at the time of product launch. Major factors driving up the BOM include the addition of the high-resolution Retina display, LTE wireless and a larger-capacity battery.
* Please note that these teardown assessments are preliminary in nature, account only for hardware and manufacturing costs and do not include additional expenses such as software, licensing, royalties or other expenditures.