February 11, 2010 / 12:32 AM / 8 years ago

iPad costs $229 to produce, says iSuppli

SAN FRANCISCO (Reuters) - Apple Inc’s forthcoming iPad tablet computer will cost as little as $229.35 for the company to produce, according to an estimate on Wednesday from research house iSuppli.

Media members try out the new "iPad" during the launch of Apple's new tablet computing device in San Francisco, California, January 27, 2010. REUTERS/Kimberly White

The group conducted what it called a “virtual teardown” of the iPad, since the device is not yet available and component suppliers have not been announced.

Apple’s iPad, which resembles a large iPhone and uses the same operating system, will go on sale as early as next month, as the company looks to define a new category of mobile devices.

For the $499 iPad — the lowest-cost model, which features 16 gigabytes of flash memory — iSuppli estimated the total materials cost at $219.35, with a $10 manufacturing cost.

The priciest iPad will cost around $335 to produce, while the mid-range model will cost roughly $287, the group said.

The most expensive component in the iPad is the 9.7-inch display and touchscreen, at an estimated cost of $80, according to the estimate.

Analysts expect Apple to ship somewhere between 2 million and 5 million iPad units in the first year.

Reporting by Gabriel Madway; editing by Andre Grenon

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