Computing

Google Might Not Be Losing Money On The Nexus 7 After All

There has been plenty of speculation about how much money Google is making — or losing — on its snazzy new Nexus 7. The analysts at IHS iSuppli tore it down, added up the cost of its components, and determined it’s cheaper than originally suspected.

AllThingsD reports that IHS iSuppli calculated a pretty healthy margin: the $US200 ($250) 8GB Nexus costs $US151.75 to build and the $US250 ($299) 16GB model costs $US159.25 to build.

The IHS iSuppli estimate is lower than others that have surfaced since the tablet was announced last month — some reports indicated that Google might actually be losing money on the tablet in order to gain market share. Google’s mobile chief Andy Rubin even admitted that the tablet was a break-even product, indicative that the marketing and development costs are and will continue to be very high.

Indeed, this estimate doesn’t take into account these costs, but even so it’s very possible that Google could make money, especially on the 16GB Nexus 7. (Funny how Google spends an extra eight bucks and charges you $50 more, huh?) Losing money is a losing strategy, so it’s nice to hear that Google might be paying more attention to the bottom line than we originally expected. [AllThingsD]


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