AMD pulls in $100 for every PlayStation 4 sold

AMD pulls in $100 for every PlayStation 4 sold

Summary: AMD's eight-core Jaguar architecture CPU, which incorporates a 1.84 TFlop Radeon GPU, is the single most expensive item inside the new PlayStation 4 games console.

TOPICS: Hardware, Processors

The next-generation consoles are out, and both the Xbox One and PlayStation 4 are powered by AMD silicon, and a teardown of the Sony's offering by analyst firm IHS suggests that AMD will pull in $100 for every console sold.

The processor, which combines an eight-core Jaguar architecture CPU with a 1.84TFlop Radeon GPU comes in, according to IHS, at a round $100. Add to this the 8GB of fast GDDR5 RAM, which is estimated to cost $88, we come to a total of $188 for just these two components, slightly more than 50 percent of the BOM of the entire console, which is put at $381.

This might seems awfully close to the $399 retail price that Sony is asking for the console, leaving a margin on the hardware of only $18, but if you compare this to the 2009 CECH-2001A version of the PlayStation 3, there the bill of materials and manufacturing cost came to $336 while the console retailed for $299.

"This time," said Andrew Rassweiler, senior director, cost benchmarking services for IHS. "Sony is on a greatly shortened path to the hardware break-even point, or even profitability, with its cost-conscious PlayStation 4 design. The company is pulling off this feat, despite offering a brand-new design that once again includes avant-garde components that yield superfast performance. The PlayStation 4 keeps a lid on costs by focusing all the additional expense on the processor and memory—and reducing outlays for the optical drive, the hard disk drive (HDD) and other subsystems."

The AMD chip used in the PlayStation 4 is built using a 28-nanometer manufacturing process, but despite the petite architecture the chip itself is a monster, coming in at 350mm2, which is three times larger than any other chip manufactured using equivalent-process technology that IHS has seen.

The RAM used in the Sony's PlayStation 4 beats what Microsoft has packed into the new Xbox One.

"GDRAM DDR5 memory has much higher bandwidth than the DDR3 used in the Xbox One. It also works better with parallel computing and is designed specifically to enhance graphics performance," said Mike Howard, senior principal analyst, DRAM and memory, for IHS. "Because of its cutting-edge status, GDRAM GDDR5 is more expensive than DDR3, which is used in high volume in products including PCs and older game consoles."

PlayStation 4 teardown analysis
(Source: IHS)

See also:

Topics: Hardware, Processors

Kick off your day with ZDNet's daily email newsletter. It's the freshest tech news and opinion, served hot. Get it.


Log in or register to join the discussion
  • Incorrect,Hate to be a stickler,Im sure you're not a tickler for a stickler

    "but if you compare this to the PlayStation 3 at launch, there the bill of materials and manufacturing cost came to $336 while the console retailed for $299."

    The console was debuted at $499 and $599 versions. 20gb and 60gb respectively. The teardown of the console revealed at the time that it cost somewhere in the neighborhood of $800 to make. Factoring in its expensive Cell Processor, Nvidia RSX chip, A state of the art blu ray player, Original components from ps2 & ps1 to provide backwards compatibility (initially a hot feature was rather soon taken out to save on the aforementioned costs) made it out to be a very expensive console.
    • Not being a stickler

      Gilgamex, you beat me to it. That item you corrected (which I was about to correct) was way off. The price was the reason I didn't get a PS3 at launch.
    • Two Different Cost Factors!

      There was the cost to design the Cell BE processor. The cost to fabricate those processors and most of which were made on Sony's own fab lines in IBM foundries or their fabrication plant later put into a Joint Venture with Toshiba. The later costs are actually paid to themselves. Like Samsung making money on their own screens and chip production.

      So yeah if you wanted to simply inflate all costs irrespective of who was making the revenue and earning the profits, yeah..... it'd total $800 cost for the first year of sales. By the 2nd year though they were close to breaking even on console sales alone. If you added up what Sony made from even one single game franchise like GT5 or Metal Gear Solid, you're talking about $55 billion alone for Gran Turismo life time sales of one game!!!

      That so called very expensive Console is a whole lot more bang for your buck today than what you get spending $2000 on contract for an iPhone!!! ....that doesn't even come close to the performance of any game console... including the Wii!!!
  • good chip

    Finally seeing those AMDs used in the right products. The APUs are great for this kind of thing but don't make it for business desktops. I wish the tech press could communicate this difference to the public.
  • My Xbox one should arrive tomorrow morning!

    One of the few advantages of being in NZ is when there is a global launch of something.. we get it first! I can hardly wait! They are, however, not releasing the Playstation 4 until the 29th on this side of the world.. so the punters will just have to wait! But from what I'm reading I'm not buying a Playstation 4 just yet.. it definitely sounds like it was rushed to market..
  • Nice to see AMD get a big win

    Hope they plow some of the profits into making newer, faster, more feature rich Athlons and Opterons.
    • You didn't see the 350mm^2 number, or just don't realize what it means.

      "coming in at 350mm2, which is three times larger than any other chip manufactured using equivalent-process technology that IHS has seen."

      With that, the actual bottom line profit (as opposed to top line revenue of $100, which excludes COST) is not going to be any kind of blockbuster.
    • They are getting out of the dedicated consumer chip business!

      Sorry but you don't seem to realize that AMD has gone completely into Fusion and SoC processor sales for consumers. On the server front they are attacking every other major chip maker including Intel again...... with Opterons meant to kick ass and take names while doing it with far superior best in class options.

      They brought back much of the original design team that had AMD kicking Intel out of the 64bit chip market as well multicores that Intel blew chunks on for years. Jim Kelly acquired from Apple, was the guy who almost single handedly made AMD a name to be reckoned with on Servers and he's back at AMD doing his old design magic..... again!

      We'll see AMD rule the ARM server market too. While also leading the way with the most powerful APU's in the World. Well the only one worth talking about. Unless you think Intel Atom chips with Intel's junk GPU's are better! ;-P

      And this was before it was reveiled that AMD would be moving to 14nm next year with Global Foundries low power SoC's and APU's. So Global is already chomping at the bit to fabricate 3D finfet stacked cores ahead of Intel and TSMC!

      Although Intel had the first 3D finfets out at 22nm, they are struggling to match Common Platform Alliance's move to 14nm FinFET processs now. There is no mention as whether they've conquered the shrinking of their process to this level!
  • $100 is top line and not bottom line... that number means nothing

    What is the exact margin on the thing?

    If the chip is priced $100 yet costs $99 to make, then overall the picture is still small potatos.

    Hint: As you've mentioned, the die size is HUGE. Now what exactly does THAT tell you?