Xbox One costs Microsoft $471 to build, according to IHS report

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Xbox One costs Microsoft $471 to build, according to an upcoming report from IHS.

The largest part of the cost comes from the Kinect camera which is packaged with the system.

According to the report, which via AllThingsD was gievn an early look at, Kinect’s manufacturing cost is $75 and the console’s combination CPU-GPU from AMD runs $110.

IHS releases its teardown report on PS4 last week, and followed it up with a video. The system, according to the firm, costs $381 to manufacture.

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Related Forum: Xbox Forum

Source: http://www.vg247.com/2013/11/26/xbox-one-costs-microsoft-471-to-build-according-to-ihs-report/

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"Xbox One costs Microsoft $471 to build, according to IHS report" :: Login/Create an Account :: 85 comments

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MSDSPosted:

There not making much of a profit at all yeah the Xbox One is pricy but they could have made it cost more so they made more of a profit I don't really have a problem with the price I have 4 Xbox One's now so they should have made it cost more to gain more profit.

RantPosted:

I guess this means they won't be going on sale. :/

KatsumiPosted:

Lavish
fex Not much of a margin for such an expensive console


They make $29 million dollars profit for every million consoles sold.
I'm sure as time goes on, they will find a cheaper way to make it.


Pretty much this, the profit margin for the console will eventually grow as the years go on

TywinPosted:

HitUWithToaster It was a good expense. But they should've made consoles without kinect. Some people don't want it. But those who do can pay the extra. I kinda like the kinect but sme people don't.


I guess you could say it is a good expense.
You would think they would be able to find a cheaper way to make it.

TywinPosted:

fex Not much of a margin for such an expensive console


They make $29 million dollars profit for every million consoles sold.
I'm sure as time goes on, they will find a cheaper way to make it.

TywinPosted:

Frog If it costs them that much to build one console, they earn about $400 for every console they sell... That's a reasonable profit for a company like Microsoft to make on each unit.


How do they make $400 from every console if it costs $471 to make and they sell them for $500.
That means they are making $29 for every console they sell.

FrogPosted:

If it costs them that much to build one console, they earn about $400 for every console they sell... That's a reasonable profit for a company like Microsoft to make on each unit.

KatsumiPosted:

fex Not much of a margin for such an expensive console


That margin will be likely to increase as time goes on. I'm pretty sure Sony was selling the PS3 for a loss initially.

fexPosted:

Not much of a margin for such an expensive console

S1LENTW31RD0Posted:

Tortarune They make the systems at a loss to the company in order to attract more users to purchase accessories, in-game currency, etc. Thats where they make their profits, so the system itself doesn't even have to make its own individual profit


Exactly its purpose is not only to attract but take over your living room with stuff like Netflix and youtube


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