“RBC Capital‘s chip analyst Doug Freedman this afternoon reflects upon the ‘tear-down’ findings of ifixit.com and chipworks.com pertaining to the iPhone 5, which went on sale three weeks ago (counting pre-orders),” Tiernan Ray reports for Barron’s.
Ray reports, “Freedman offers the following stunning assessment of Apple’s markup on NAND flash memory: ‘We were surprised to see Apple continue to charge $100 for each incremental 16GB of NAND, given that AMZN is charging $50 (Kindle Fire HD 7” and Kindle Fire HD 9” LTE) to $70 (Kindle Fire HD 9” WiFi) for each 16GB of NAND. We estimate that Apple is able to procure NAND flash for ~$0.42 per GB (at market prices or better), while reselling for $6.25 per GB (calculated as $100 for each 16GB of step-up). This implies a favorable 93% gross margin on NAND.'”
Read more in the full article here.