iPad Air Component Costs Estimated to Begin at $274, Roughly 13% Cheaper Than iPad 3

IHS Suppli has released its estimate of the component costs involved in building the new iPad Air, performing a virtual teardown based on information revealed by Apple and industry knowledge. According to IHS estimates, the component cost of the iPad Air is between $274 and $361 depending on the model, with the base model's components actually totaling $42 less than that of the entry-level third generation iPad last year despite significant technology improvements to reduce size and weight while improving performance. IHS iSuppli did not perform a cost analysis on the fourth-generation iPad, which was released in late 2012.

The estimates from IHS iSuppli cover only the cost of the various components that make up the device and do not include other costs involved in product development, manufacturing, and sales, such as research and development, software, patent licenses, marketing, and distribution expenditures. The full report has not yet been released but AllThingsD received early access.

ipadair_torndown
The bill of materials includes $90 for the display, $43 for the touchscreen components, $18 for the A7 chip manufactured by Samsung, between $9 and $60 for the Toshiba-made flash memory chips, $10 for the DRAM chips manufactured by Elpida, and $32 for the cellular data network chips made by Qualcomm for the LTE-ready versions of the iPad Air.

IHS analyst Andrew Rassweiler also points to the iPad Air's advances when it comes to supporting various LTE frequencies:

With the iPad Air, Apple appears to have reached a new milestone on the wireless front: It can support every LTE frequency with a single combination of chips. “This is something Apple tried to do with the iPhone 5S and 5C, but it couldn’t quite get there,” Rassweiler says. “One single model of the iPad Air is able to work with all US wireless carriers.”

IHS iSuppli reported last month that iPhone 5s component costs were estimated to begin at $199, with the cheaper iPhone 5c's costs estimated to be starting at $173. The iPad Air was released last Friday with adoption rates reportedly outpacing last year's iPad 4 and iPad mini launches, although Apple has yet to release official sales numbers for the device's opening weekend.

The full IHS Suppli report should be released tomorrow.

Related Roundup: iPad
Buyer's Guide: iPad (Buy Now)
Related Forum: iPad

Popular Stories

iPhone 17 Pro Blue Feature Tighter Crop

iPhone 17 Pro Launching in Three Months With These 12 New Features

Saturday June 14, 2025 5:45 pm PDT by
The iPhone 17 Pro and iPhone 17 Pro Max are three months away, and there are plenty of rumors about the devices. Below, we recap key changes rumored for the iPhone 17 Pro models as of June 2025:Aluminum frame: iPhone 17 Pro models are rumored to have an aluminum frame, whereas the iPhone 15 Pro and iPhone 16 Pro models have a titanium frame, and the iPhone X through iPhone 14 Pro have a...
apple watch ultra 2 new black

Apple Watch Ultra 3 Finally Coming After Two-Year Hiatus

Monday June 16, 2025 8:45 am PDT by
Apple will finally deliver the Apple Watch Ultra 3 sometime this year, according to analyst Jeff Pu of GF Securities Hong Kong (via @jukanlosreve). The analyst expects both the Apple Watch Series 11 and Apple Watch Ultra 3 to arrive this year (likely alongside the new iPhone 17 lineup, if previous launches are anything to go by), according to his latest product roadmap shared with...
apple watch ultra snow

6 Features Coming to the Apple Watch Ultra 3

Tuesday February 25, 2025 9:00 am PST by
The Apple Watch Ultra 3 is expected to launch later this year, arriving two years after the previous model with a series of improvements. While no noticeable design changes are expected for the third generation since the company tends to stick with the same Apple Watch design through three generations before changing it, there are a series of internal upgrades on the way. By the time the ...
terminal macos tahoe

Apple's Terminal App Gets Colorful Redesign in macOS Tahoe

Monday June 16, 2025 4:12 am PDT by
Apple's Terminal app is getting a visual refresh in macOS Tahoe, and it's the first notable design update since the command-line tool debuted. The updated Terminal will support 24-bit color and Powerline fonts, according to Apple's State of the Platforms presentation at WWDC25. The app will also adopt the new Liquid Glass aesthetic with redesigned themes that align with macOS 26's broader...
iOS 26 on Three iPhones

Apple Says iOS 26 Won't Be Available on These iPhone Models

Tuesday June 10, 2025 6:58 am PDT by
Apple this week revealed that iOS 26 is compatible with the iPhone 11 series and newer. That means that iOS 18 is the end of the road for the iPhone XS, iPhone XS Max, and iPhone XR, which were all released in 2018. However, those devices will continue to receive security updates for at least a few more years. iOS 26 is compatible with the following iPhone models: iPhone 16e iPhone...
new iphone lockscreen ios 26

iOS 26: Five Changes Coming to Your iPhone Lock Screen

Tuesday June 17, 2025 8:46 am PDT by
With iOS 26, Apple has made some additions to the iPhone Lock Screen that aim to make it more customizable than ever. Of course, things can always change before the software makes its way to the general iPhone-owning public, but here are five new things iOS 26 can do on the Lock Screen as of the current developer beta. Widgets Top or Bottom In iOS 18, the row of widgets on your Lock...
iOS 18

Apple Releases iOS 18.6 Public Beta

Wednesday June 18, 2025 10:24 am PDT by
Apple today seeded the first betas of upcoming iOS 18.6 and iPadOS 18.6 updates to public beta testers, with the betas coming just a few days after Apple provided the betas to developers. Testers who have signed up for beta updates through Apple's beta site can download iOS 18.6 and iPadOS 18.6 from the Settings app on a compatible device by going to General > Software Update. When the...

Top Rated Comments

macduke Avatar
152 months ago
It's pretty ridiculous that Apple still charges $500 for the 16GB base model. Should be at least 32GB.

I'm not surprised that the thing is cheaper. The 3rd gen was pushing the limits on what you could do at the time with a giant battery and brand-new display tech. The iPad Air has many of the same components: 5MP camera, same screen resolution, same amount of RAM, same storage capacities. It's probably a big reason why they could make the Retina Mini for $100 less. The Air helps subsidize it.
Score: 39 Votes (Like | Disagree)
bbeagle Avatar
152 months ago
Coca-Cola is just sugar, flavoring and water.

It costs about 5 cents in materials to make a 2-liter. They sell it for between $1 and $2.

That's a 1,000-2,000% markup. Where are the articles on this? :rolleyes:
Score: 26 Votes (Like | Disagree)
Lapidus Avatar
152 months ago
I guess that's excluded the costs of innovation & research etc. etc...
Score: 21 Votes (Like | Disagree)
HenryDJP Avatar
152 months ago
Then they should reduce the price by 13%.

In the end they would still earn more anyways!

Time for apple to show some good-will after everything they have put us through the last 24 months.

Oh yeah exactly, just like they are still charging for OS X and iWork, even for customers that have the previous versions of these. They never show any goodwill and give anything for free for customer appreciation. :rolleyes:
Score: 18 Votes (Like | Disagree)
appleguy123 Avatar
152 months ago
Apple could have doubled the space and still kept higher margins than last time.

16gb for $500 is ridiculous for 2013.
Score: 16 Votes (Like | Disagree)
HenryDJP Avatar
152 months ago
That's almost $300 without the labor of building it. My colleague in the first post thinks it's pretty ridiculous of Apple to charge so much for the 16GB but at already close to $300 without labor, R&D and advertising what do you expect Apple to do to make a profit? Would I love for it to be cheaper? Surely, but at the end of the day it's business and you don't have to buy, just remember that.
Score: 15 Votes (Like | Disagree)