Depreciation on buildings and equipment, salaried headcount and upkeep all cost about the same no matter how much a plant produces. Contract chipmaking carries an unusually high share of these fixed costs because of the capital sunk into equipment, so idle lines lose money regardless of selling price. Past the break-even point the reverse holds and incremental revenue converts almost entirely into profit. It is the first structure to check when a company's margins swing sharply in either direction.