Researcher estimates iPod nano profit margin at 50%

Market research firm iSuppli has disassembled a 2GB iPod nano and estimates the $199 device’s components to cost Apple $90.18 to build and $8 to assemble, leaving a profit margin of about 50% before marketing and distribution costs.

“That’s consistent with the margins on earlier iPod versions and serves as a reminder of what a profit machine the iPod family of products has become for Apple since it was introduced in 2001,” notes BusinessWeek.

iSuppli also confirmed who makes the parts Apple used in the device. As expected, the firm said the nano’s audio-chip is made by PortalPlayer, its flash memory by Samsung, and that Apple dropped the touch-sensitive technology from Synaptics in favor of an Apple-designed click wheel that contains a 55-cent chip from Cypress.

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