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Apple will save around $2.5 Billion by switching to M1 chip in 2020 alone

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The Cupertino giant has recently switched to Apple M1 chip for all of its products including MacBook Air, MacBook Pro and the Mac mini. Well, is it because of the performance improvement only that Apple ditched Intel? Partially true enough but in the meantime, Apple is reportedly saving about $2.5 Billion by switching to M1 chip and its for 2020 alone.

As reported by Wccftech, the report has been calculated by IBM AI strategy lead Sumit Gupta, who claims that Apple’s M1 chip will cost for the company between $40-50 per unit. If this is the case the price difference could be huge when compared that cost to a $200 Intel Core i5 processor for the previous-gen MacBook Air or even the MacBook Pro.

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Obviously, this will help Apple save a lot of money on all of the new Macs and here’s a cost breakdown provided by Gupta:

ARM-based Apple M1 processor cost: $50 (might be closer to $40)
Intel Core i5 Dual-Core for MacBook Air: $200 (maybe $175)
Intel Core i5 Quad-Core for MacBook 13-Entry: $250 (maybe $225)
Costs of MacBooks with Intel:
MacBook 13-Entry: 8.6 M units x $250 = $2.15 B
MacBook Air: 5.4 M units x $200 = $1.07 B
Total = $3.2 B
Costs of MacBooks with ARM-based M1:
MacBook 13-Entry: 8.6 M units x $50 = $268 M
MacBook Air: 5.4 M units x $200 = $429 M
Total = $697 M
That is a saving of $2.5 Billion for Apple […]

This is a huge saving for Apple and we expected it to reduce the MacBook pricing and as for the fact the price remains the same, Apple is expected to make more profit than ever! However things look good on paper, Gupta admits that these are estimates and could change in the future.

As we know the 5nm based M1 chip is a very complex silicon with components like the GPU and unified RAM. The complexity with which Apple has developed could eventually mean it would cost Apple a lot more than $40-50, still Apple has made a wonderful chip and in the years to come we can expect more from the company.

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Raunak Saha
Raunak Saha
A cs engineer by profession but foodie from heart. I am tech lover guy who has a passion for singing. Football is my love and making websites is my hobby.

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