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Apple's iPhone: Breaking Down Who's Making The Money

Tuesday, 3 Jul 2007 | 1:27 PM ET

While most Mac geeks were worshipping at the iPhone altar this weekend, we here at CNBC got some tech geeks to dissect an Apple iPhone for us (see video below). Called a "tear down", it's when you break apart a gadget to figure out what's inside, and how much those components cost. We got one of the top companies in this field--called iSuppli-to peel apart the (Apple) gadget for us.

Apple is raking it in, perhaps more than you would think. iSuppli says Apple is getting over 50 percent margins on the iPhone with the smaller memory, and even higher margins with the higher memory phones. And Apple isn't the only one cashing in: iSuppli uncovered which suppliers are making money on each handset sale. Samsung is the biggest winner making between 52 and 76 dollars per handset, depending on the memory of the phone.

iPhone: Component Stocks
Apple is not the only company cashing in on the iPhone. CNBC's Julia Boorstin has the inside story.

There are also a handful of public companies lucky enough to get a piece of Apple's iPhone pie. Infineon is providing the edge chips that connect to AT&T's phone system, and its phone components bring Infineon over 15 dollars in revenue per handset sold. Marvell brings in 6 dollars per handset. And this is a pretty big deal--Infineon and Marvell weren't included in iPods, so this is a big new deal for them. And know that touch screen everyone's raving about? That's National Semiconductor , which gets about 1.50 in revenue per handset.

These companies will bring tens of millions in additional revenue this quarter alone thanks to these contacts, more, depending on how many iPods sell. But Apple isn't committing to any of these manufacturers over the long haul. When they eventually transition to the next generation of iPhone, they want to have the flexibility of switching to better technology. But for now at least, all these suppliers are harvesting on Apple's iPhone buzz.

Questions? Comments? MediaMoney@cnbc.com

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  • Working from Los Angeles, Boorstin is CNBC's media and entertainment reporter and editor of CNBC.com's Media Money section.