iPod Shuffle Only Costs $21.77 to Make

An iSuppli teardown estimates the cost of the shuffle's components, the headphones, and the packaging it ships in at $21.77.

Business Week says 'that's about 28% of the device's retail price. The smaller the component cost as a percentage of price, the higher the potential profit. This suggests the per-unit profit margin on the shuffle is higher than on other iPod models. The component cost for the first iPod touch released in 2007, for instance, amounted to about $147, or about 49% of its $299 retail price. The component cost of the third-generation iPod nano, also released in 2007, amounted to about 40% of its retail price.'

The main application chip used in the device is made by Samsung. Other suppliers include Toshiba, Hynix Semiconductor, On Semiconductor, NXP Semiconductor, and Texas Instruments.

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