All Things D reports that IHS iSuppli has torn down a Google Nexus 7 tablet and estimates the cost of materials for the 8GB model to be $151.75, and $159.25 for the 16GB model. That's about $30 less than the estimate released late last month by UBM Techinsights, which was made before they had a chance to tear down an actual tablet. At $151.75, IHS iSuppli believes that Google is breaking even on sales of the 8GB model ($199) and is making a nice profit on the 16GB model. Andrew Rassweiler, who runs the teardown team at IHS iSuppli, said "It’s (Google'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."
The company believes that the Nexus 7 costs $18 more to build than the
current Kindle Fire--which indicates that Amazon could easily release a
second-generation Kindle Fire with comparable specs to the Nexus 7 at
the same $199 price.