It's not an unreasonable question. Product costs should fall as the contract manufacturer becomes more familiar with the manufacturing process. A lot of CM contracts will have clauses on how these efficiency gains are split between the CM and the OEM. Usually there is an earn out for cost reductions that are "discovered" by the CM, say 25%-50% for 3-9 months and then the full benefit is passed to the OEM. Obviously an improvement in efficiency from the OEM is passed 100% on to the OEM. An update on production in Costa Rica would be worthwhile.
As a first port of call they need to get over their fixed cost hump, then work on refining the process.
No real surprises in that 4c, marginally better than I expected. Would have been nice to have the cap raise after a bit of SP strength, but it's no disaster at this price level.
It's not an unreasonable question. Product costs should fall as...
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