Nintendo is paying an estimated $180 (£113.5) for the materials required to manufacture each Wii U console, with no more than $50 (£31.5) of that total being spent on the tablet controller.
That's according to Forget the Box's sources, who are said to be closely involved with manufacturing and distributing Nintendo products.
Factoring in labour, marketing and other costs, the console will retail for no less than $300 (£189) when it launches later this year, the site claims.
The source commented: "Cutting production costs to maximize profits is Nintendo's main concern with the Wii U. They are cutting costs in the Wii U's hardware to build back confidence in investors. Nintendo wants investors to view Wii U as a less risky proposition.
"Nintendo chose an economical GPU and CPU that could keep up with the performance of today's current consoles, but keep hardware costs down to maximize profits. Nintendo got a bargain price on the custom GPU and CPU that the Wii U uses. There is a bigger focus on downloadable content, applications, video content, digital distribution, and services to create a stream of revenue. Investors will be ecstatic with the news."
Last week, Nintendo issued a statement in response to growing reports that Wii U won't be as powerful as PS3 or Xbox 360. A spokesperson said the company doesn't "focus on technology specs" and that "the experience of playing will always be more important than raw numbers".