iPad 2 Teardown: Where The Parts Come From; How Much They’re Worth

Starting price tag for the iPad2 (3G) is $699. Aside from the cost of developing its software, packaging, shipping/distribution, marketing, and manufacturing – how much does the iPad2 hardware actually cost?

According to All Things Digital, who got an exclusive scoop in the latest breakdown performed by market research firm IHS iSuppli, the total cost of the iPad 2 hardware for a 32 GB iPad 2 (3G) which sells for $699 comes in at $325. The report also breaks down the cost of every pieces inside the iPad 2, from it’s A5 chip ($14) to its touch screen display ($127).

iPad 2 Breakdown Estimates

Wireless Baseband Chip	$26.88	Intel (AT&T) and Qualcomm (Verizon)
A5 Processor Chip	$14.00	Samsung
Touch-screen Display	$127.00	LG
Flash and DRAM Memory	$65.70	Toshiba
Gyroscope and Accelerometer	$29.00	STMicroelectronics
	$262.58	-Estimated breakdown cost

So, do you think you’re getting ripped by Apple? Probably not. If you consider the cost of  developing software for the device, packaging, shipping/distribution, marketing, manufacturing, and taxes, the price of an iPad 2 is not that bad compared to other tablets that will set you for about $800.