iSuppli Reveals Google Nexus Costs About $152 To Build

Posted Jul 11, 2012

The Google Nexus 7 components look similar to the Kindle Fire when you bust it open according to IHS iSuppli. The Nexus 7 appears to cost $151.75 to build and it sells for $199. This means that the mark-up is decent, but not great for the bottom line. The higher end 16GB Nexus 7 sells for $249 and costs $159.25 to build. Andrew Rassweiler, the guy that led the teardown team at IHS iSuppli, said that Google would break even on the 8GB model, but would make a solid profit on the 16GB model.

?Like Apple, Google realizes it can boost its profit margin by offering more memory at a stair-step price point. It?s getting $50 more at retail for only $7.50 more in hardware cost, which sends $42.50 per unit straight to the bottom line,? said Rassweiler.

The Nexus 7 uses the Nvidia Tegra 3 processor and has a four chip core, which means that it has four main processing chips.  The Kindle Fire has a two-core OMAP 4430 processor made by Texas Instruments.  Texas Instruments supplied two chips for the Nexus 7, including a power-management chip and a low-voltage transmitter.

The Nexus 7 is built by Asus for Google.  The Nexus 7 has a resolution of 1,280 x 800 pixels versus the 1,024 x 600 for the Kindle Fire.  Rassweiler said the Nexus 7’s display uses technology known as in-plane switching and adds $38 to the hardware cost of the Nexus 7.  The display on the Kindle Fire is $35.  The Nexus 7 has a camera that added $2.50 in the cost for the Nexus.

The Nexus has a chip from NXP that supports near field communications (NFC).  Broadcom built the GPS receiver chips to support mapping.  Invensense built the gyroscope and accelerometer.  IHS iSuppli said that the Nexus 7 costs about $18 more to make than the Kindle Fire.  Rumor has it that there will be a new Kindle Fire coming out this fall.