"Despite the obvious changes to iPad like the enclosure and the battery, and the less obvious changes in the touch screen, the iPad 2's components and design are remarkably similar if not the same as those of the iPad 1," said analyst Andrew Rassweiler. Both use the same components and suppliers for the NAND, multitouch controllers, touchscreen drivers and more.
More than a third of the iPad 2's expense stems from its 9.7-inch multitouch IPS display, which costs approximately $127. Its NAND storage and DRAM are the second most expensive, with memory chips representing $65.70 of the total cost. Materials related to the enclosure such as glass, metals and plastics as well as PCBs and connectors amounted to $25.
The iPad 2 battery is thinner than its predecessor and has one more cell, driving the cost from $21 to $25. Intel's GSM/HSPA chip costs $18.70 versus $16.35 for Qualcomm's CDMA module, and the former doesn't have integrated GPS, so that adds an extra $1.10 to the connectivity expense. Apple's A5 processor costs $14, which is 75% more than the original iPad's A4 chip.
The various sensors and controllers for user input (gyroscope, accelerometer, ambient light sensor etc.) total $11.90. Apple's box contents such as packing materials, booklets and accessories costs $5.80. The iPad 2's 720p camera, something the original slate didn't have, is reportedly the cheapest component at $4.30. ISuppli figures each unit costs $10 to manufacture.