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Saturday January 30, 2010

Apple Makes Significant Profit on iPad Hardware Sales

A bill-of-materials (BOM) analysis revealed that Apple stands to make $208 on each $499 iPad sold. That figure jumps to $446 per top-end $829 iPad. While some makers lose money on hardware, especially during launches (see Xbox 360, PS3, etc), so that they can make it up in licensing and software sales, Apple doesn’t appear to be bound by those restrictions. Hey, if it works for Amazon's Kindle, it’s bound to work for a company with a much wider (and devoted) fanbase, right?

High profit margins are standard for Apple, which earlier in the week boasted that its corporate margin for 2009's final quarter was 40.1%. Some products, in fact, have estimated margins even higher than Marshall's iPad numbers: The consensus for the iPhone 3GS is above 60%, for example.

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