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News
New iPod shuffle Lands Big Profits
Tuesday, April 14th, 2009 at 12:21 PM - by Jeff Gamet
Apple's newest iPod shuffle isn't just just small in your pocket, it's also light on Apple's pocketbook. According to data from iSuppli, the US$79 music player includes $21.77 in parts -- including earbuds and packaging.
iSuppli is well known for stripping electronic devices down and estimating how much the individual components cost.
Samsung looks to be making out well on the new iPod shuffle, according to BusinessWeek. The main controller chip in the shuffle comes from Samsung and costs US$5.98, and the 4GB of flash memory also comes from Samsung and costs Apple $6.
Apple is likely also buying flash memory for the shuffle from Toshiba and Hynix Semiconductor.
The shuffle's component costs come in at about 28 percent of the selling price, but that doesn't mean Apple is earning a 72 percent profit on each unit sold. The company has to account for product design costs, shipping and marketing expenses, too. Even with those extra expenses, however, Apple is likely seeing a better profit margin on its newest iPod shuffle.
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