Nexus 7 costs $152 to manufacture according to teardown report

By Cory Gunther
on 11 Jul, 2012

A new teardown report of ASUS and Google’s new Nexus 7 tablet has been released that conflicts with previous reports. After announcing the tablet Google was quoted saying they were making no profit from the tablet, but that wasn’t entirely accurate. Last week we reported the tablet cost around $184 to manufacture but new reports today claim it’s much less.

According to AllThingsD, who spoke with teardown specialists iSuppli the Nexus 7 costs a little under $152 for Google and ASUS to manufacture and produce. That is for their 8GB model priced at $199. This means after the $25 free gift card to the Play Store, shipping, advertising and logistics they probably were being honest in saying they’ll pull zero profit from the slate.

The 16GB model however is their bread and “butter” where it will be purely profit. Costing $249 for buyers yet only costs Google an additional $7 to add in another 8GB memory module, making the other $50+ pure profit for the folks at Google and ASUS. iSuppli even mentions the Nexus 7 costs only $18 more than the Kindle Fire to produce. What does that $18 get you? A camera, Tegra 3 quad-core processor, and a better display — all things I’m sure the Kindle could have managed.

For many these teardown and cost estimations don’t matter, but it’s interesting to see the full breakdown and cost analysis. Did you buy the Nexus 7 and if so did you get the 8GB or 16GB?

[device id=2841] [via SlashGear]

Mike

It is perhaps a bit presumptuous to say that Google lied in making no profit on the 8GB model. A BOM does not take into account assembly and labor costs. Nor does it take into account design, shipment and labor costs. It is a gross misstatement to argue that the cost of materials constitutes the cost of the device.
Magnus100

Don’t give a flying rats tail how much it cost them to make the tablet. Just wanted to mine now. I wish there was the option for one with 64gb. Would definitely have purchased that one. For now I’ll make do with the 16GB.
http://twitter.com/Sonicaholic Sonicaholic

It’s a Los Leader its amed at novice tablet consumers, because there eco system is worth more in the general publics hands than the profit they will ever make of the device itself. Cloud space will become a Predominate feature in this market place as Google push for the lack of sd card slots on android devices, for stability reasons as much as they can then sell you cloud storage. Having an sd card slot forces the OS to read 2 file formats, that has an effect on speed among other things.
Milind

I agree with Mike that cost of parts cost to produce. I
ordered the 8 GB model because $200 is the sweet spot and $50 for 8GB is
a complete rip off. In fact am mad at Google for not adding an SD card
slot – which would have made it the perfect tablet for me.