• Competitor rules

    Please remember that any mention of competitors, hinting at competitors or offering to provide details of competitors will result in an account suspension. The full rules can be found under the 'Terms and Rules' link in the bottom right corner of your screen. Just don't mention competitors in any way, shape or form and you'll be OK.

I wonder what it actually costs Intel to make a CPU

sybaris

sybaris

sybaris

Associate
Joined
21 Jun 2010
Posts
787
Location
infornt of my PC
does anyone actually know what it costs Intel to make a CPU.
Equipment costs and staff costs aside.
Just the materials used in the chip its self.
How much mark up do they make on a processor?
 
the mark up on the raw materials is massive, its the staffing, r&d and facilities that cost them the real money
 
Yup as tom e says. There was a similar thread on here a while back with a nice graphic showing all the costs, worth a find :)
 
well they had a factory in cebu philippines and i know the workers there where only getting £50 a month so staffing cost isnt that high. They must be making a very good profit.
 
Production-per-unit is nothing, it's the research/development, marketing, consumer/distributor relations, management, distribution, fittings, estates upkeep etc. that add up. Really, when talking about a massive operation like this it would be grossly misleading to isolate and judge any one aspect without considering the enterprise as a whole. The reasoning behind your inquiry would hold only if the product in question could be produced without said enterprise, which is obviously not the case here.


Can't just pour some sand in your hand and drop a few metal coins yelling 'hey lo and behold, 99.7% markup what a ripoff !!!1'



- Ordokai
 
Last edited:
Don't think I'll ever gripe about the price of a CPU - never ceases to astound me the millions, soon to be billions of blighters packed in one tiny square working tirelessly for years!
 
Ordokai said:
Production-per-unit is nothing, it's the research/development, marketing, consumer/distributor relations, management, distribution, fittings, estates upkeep etc. that add up. Really, when talking about a massive operation like this it would be grossly misleading to isolate and judge any one aspect without considering the enterprise as a whole. The reasoning behind your inquiry would hold only if the product in question could be produced without said enterprise, which is obviously not the case here.


Can't just pour some sand in your hand and drop a few metal coins yelling 'hey lo and behold, 99.7% markup what a ripoff !!!1'



- Ordokai
Click to expand...

Correct in all points. People just need to think of service providers, it doesn't cost anything for the service, it's all the other bits that cost!

If you really want to find out the costs that intel has (not for the cpu alone though) just look at their income statement at the COGS (cost of goods sold) and you'll see how much it is.

EDIT: Just checked, apparently in the last quarter's income statement Intel declared 10.3bn (US dollars) of revenues and 3.8bn of "cost of revenue" (i.e. cost of goods sold) with a gross profit of 6.5bn (!!!!!). Not included in the COGS are: R&D cost her 1.5bn (lots of monies!) but the biggest operating expense is the selling and aministrative general expenses (marketing, distribution yada yada) at a staggering 4.5bn, that is per quarter! Net income was almost 2.5bn, not bad for 10.3bn of sales. That's about 25% profit which is after taxes and interest. They look like they are blazing through!
 
Last edited:
wannabedamned said:
More at the beginning of a new CPU stepping, And less and less as they perfect that particular CPU. Same trend every time we see a new one
Click to expand...

I am not so sure about that, the R&D costs of Intel are stable year-on-year (looking at the income statements of 07,08,09). Surely there should have been a bump with the i7? (or would that show in the previous income stat's? not sure about the timeline of the i7 development). Either way, they seem to be spreading their costs evenly from year to year to avoid the volatility in their cash flow which could upset short-term investors.

EDIT: sorry, just realised you were referring to the actual cpu production costs. Ignore my comment.
 
Redmint said:
The Intel hex cores (and most of the extreme editions) they release are over priced. ;)
Click to expand...

I agree with the Extreme Editions. Basicaly getting the best of the batch and charging 3x the price.
As for the rest of the range then I don't think that they are that overpriced.
 
You must log in or register to reply here.
Back
Top Bottom