Microsoft (MSFT) Strikes Profit Gold with New Surface Tablet (AAPL)
Tweet
Share
E-mail
Get Alerts MSFT Hot Sheet
Price: $390.49 +1.62%
Overall Analyst Rating:
SELL (= Flat)
Dividend Yield: 0.9%
EPS Growth %: +16.2%
Overall Analyst Rating:
SELL (= Flat)
Dividend Yield: 0.9%
EPS Growth %: +16.2%
Join SI Premium – FREE
Microsoft (Nasdaq: MSFT) is ticking higher on the session Tuesday amid new data behind its Suface tablet PC.
IHS (NYSE: IHS) iSuppli performed a bill of materials (BOM) summary for the components and labor going into build the device versus Apple's (Nasdaq: AAPL) iPad. Without manufacturing, the BOM for the Windows RT Surface is $271, moving up to $284 when the BOM is added.
The most expensive part of the device, clearly, is the 10.6-inch multitouch panel, which runs $101. Memory of 2-GB DDR3L RAM and 32-GB NAND Flash + DRAM runs about $34, the second most expensive part of the device. NVIDIA's (Nasdaq: NVDA) Tegra 3 is $21.50, while a user interface (UI)/sensor/combo module runs $20. The batter (7.4 volts) is also $20.
Given that Microsoft is selling the tablet for $599, that adds up for a handsome profit margin. Again, there's shipping, freight, and sales costs, not to mention marketing, licensing fees, and so on, that will hit those margins.
Conversely, the third-generation iPad costs $333 to make with a price tag of $599.
The iPad Mini is said to have a BOM of $188 and sells for $329 for the 16-GB version. Profit on that device is 43 percent, though IHS notes that the profit jumps $90 when the 32-GB version is selected.
Microsoft is up 1.2 percent on the session, while Apple is up about 0.3 percent.
IHS (NYSE: IHS) iSuppli performed a bill of materials (BOM) summary for the components and labor going into build the device versus Apple's (Nasdaq: AAPL) iPad. Without manufacturing, the BOM for the Windows RT Surface is $271, moving up to $284 when the BOM is added.
The most expensive part of the device, clearly, is the 10.6-inch multitouch panel, which runs $101. Memory of 2-GB DDR3L RAM and 32-GB NAND Flash + DRAM runs about $34, the second most expensive part of the device. NVIDIA's (Nasdaq: NVDA) Tegra 3 is $21.50, while a user interface (UI)/sensor/combo module runs $20. The batter (7.4 volts) is also $20.
Given that Microsoft is selling the tablet for $599, that adds up for a handsome profit margin. Again, there's shipping, freight, and sales costs, not to mention marketing, licensing fees, and so on, that will hit those margins.
Conversely, the third-generation iPad costs $333 to make with a price tag of $599.
The iPad Mini is said to have a BOM of $188 and sells for $329 for the 16-GB version. Profit on that device is 43 percent, though IHS notes that the profit jumps $90 when the 32-GB version is selected.
Microsoft is up 1.2 percent on the session, while Apple is up about 0.3 percent.
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- Microsoft is planning to merge its consumer and enterprise Copilot chatbots in August - The Information
- Xbox testing disc-to-digital feature that digitizes a physical game collection
- Buy the pullback in this neocloud stock after Meta news: analyst
Create E-mail Alert Related Categories
Insiders' Blog, Retail SalesSign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!
