Marshall concluded the most expensive piece in the iPad's bill of materials (BOM) is the 9.7-inch touch-sensitive display, which he put at $100. Apple's most profitable item, meanwhile, is the 3G radio: Models carrying the unit cost $130 more than those without, while it only costs the company $16.
The total BOM for the 16GB WiFi-only iPad is $270.50, plus a $10 line item dedicated to manufacturing and another $20 set aside for warranty service costs. The 16GB of memory and the aluminum case are estimated to cost about $25 each, while the Apple A4 processor chip is put at $15.
Profitability appears to scale up as the lineup increases in capacity, since the 32GB and 64GB iPads only see their costs rise another $25.50 and $76.50, respectively, but their suggested prices go up $100 and $200.
