Apple Gobbles Up 80% of the Profits in the Smartphone Industry

[SherDil]

While 2016 saw the rise of Chinese smartphone companies, it is still hard to see them making a profit with the presence of two giants in Apple & Samsung.



According to a report from Strategy Analytics through The Korea Herald, the entire smartphone industry enjoyed profits of $53.7 billion. Out of that, Apple earned $44.9 billion, or 79.2%.

Small Share With Large Profits
That is truly remarkable, if not surprising, when you consider Apple’s market share of 14.5-percent. Apple still had its best year ever in terms of sales, which saw it momentarily pass Samsung in terms of sales for the first time in year, even if it was helped slightly by a calculation quirk that saw it counting an extra week.

This goes on to show that Apple is much more successful as a business compared with Android phone makers due to maximizing profits out of a relatively smaller market share of the smartphone industry.

Samsung With A Measly Profit
Following Apple was Samsung which garnered a comparatively less impressive profits of $8.3 billion, despite its slightly larger market share of 14.6%

Following the two companies are the Chinese, namely Huawei, Oppo and Vivo, although their shares are comparatively smaller at 1.6, 1.5 and 1.4-percent, respectively.

Apple’s lead has declined compared with previous years however. The company according to another report at one point had more than 100% of the industry’s profits, however, that seems to have changed for now.

Its share of the industry profits could still go higher with the launch of the next iteration of their flagship, iPhone 8 planned for this year with a price point of more than $1000.

https://propakistani.pk/2017/03/10/apple-gobbles-80-profits-smartphone-industry/

 

[Hamartia Antidote]

While 2016 saw the rise of Chinese smartphone companies, it is still hard to see them making a profit with the presence of two giants in Apple & Samsung.



According to a report from Strategy Analytics through The Korea Herald, the entire smartphone industry enjoyed profits of $53.7 billion. Out of that, Apple earned $44.9 billion, or 79.2%.

Small Share With Large Profits
That is truly remarkable, if not surprising, when you consider Apple’s market share of 14.5-percent. Apple still had its best year ever in terms of sales, which saw it momentarily pass Samsung in terms of sales for the first time in year, even if it was helped slightly by a calculation quirk that saw it counting an extra week.

This goes on to show that Apple is much more successful as a business compared with Android phone makers due to maximizing profits out of a relatively smaller market share of the smartphone industry.

Samsung With A Measly Profit
Following Apple was Samsung which garnered a comparatively less impressive profits of $8.3 billion, despite its slightly larger market share of 14.6%

Following the two companies are the Chinese, namely Huawei, Oppo and Vivo, although their shares are comparatively smaller at 1.6, 1.5 and 1.4-percent, respectively.

Apple’s lead has declined compared with previous years however. The company according to another report at one point had more than 100% of the industry’s profits, however, that seems to have changed for now.

Its share of the industry profits could still go higher with the launch of the next iteration of their flagship, iPhone 8 planned for this year with a price point of more than $1000.

https://propakistani.pk/2017/03/10/apple-gobbles-80-profits-smartphone-industry/

Hmm...entire smartphone total is $53.7B
Apple + Samsung is $44.9B + $8.3B = $53.2B

That leaves the entire rest of the companies in the world making a puny $500M.

 

[I S I]

Apple Zindabad.

-Sent from an LG.

 

[Hamartia Antidote]

While 2016 saw the rise of Chinese smartphone companies, it is still hard to see them making a profit with the presence of two giants in Apple & Samsung.



According to a report from Strategy Analytics through The Korea Herald, the entire smartphone industry enjoyed profits of $53.7 billion. Out of that, Apple earned $44.9 billion, or 79.2%.

Small Share With Large Profits
That is truly remarkable, if not surprising, when you consider Apple’s market share of 14.5-percent. Apple still had its best year ever in terms of sales, which saw it momentarily pass Samsung in terms of sales for the first time in year, even if it was helped slightly by a calculation quirk that saw it counting an extra week.

This goes on to show that Apple is much more successful as a business compared with Android phone makers due to maximizing profits out of a relatively smaller market share of the smartphone industry.

Samsung With A Measly Profit
Following Apple was Samsung which garnered a comparatively less impressive profits of $8.3 billion, despite its slightly larger market share of 14.6%

Following the two companies are the Chinese, namely Huawei, Oppo and Vivo, although their shares are comparatively smaller at 1.6, 1.5 and 1.4-percent, respectively.

Apple’s lead has declined compared with previous years however. The company according to another report at one point had more than 100% of the industry’s profits, however, that seems to have changed for now.

Its share of the industry profits could still go higher with the launch of the next iteration of their flagship, iPhone 8 planned for this year with a price point of more than $1000.

https://propakistani.pk/2017/03/10/apple-gobbles-80-profits-smartphone-industry/

http://blogs.barrons.com/asiastocks...ms-falling-behind-apple-on-features-upgrades/

By Shuli Ren
As costs of smartphone components such as memory chips rise, Chinese smartphone manufacturers are seen to be falling behind Apple (AAPL) in new features upgrades.

China’s smartphone manufacturers adopted dual cameras on their high-end models shortly after trendsetter Apple included the feature on its iPhone 7.

iPhone 7 Plus.
Tiernan Ray for Barron’s
But according to Ken Hui at Huatai Securities, a mainland Chinese brokerage, smartphone manufacturers in China are struggling to sell phones that cost more than 3,000 yuan ($440), and they have started to remove expensive features such as dual cameras.

Hui’s bearish outlook does not bode well for Sunny Optical (2382.Hong Kong), which has rallied over 50% this year.

And it is not just dual cameras – Chinese OEMs are foregoing 3D glass, waterproofing, and haptic technology too as they preserve margins. While Hui has a Sell rating on Sunny Optical, he has a Hold position on haptics supplier AAC Technologies (2018.Hong Kong), which has gained 19.5% this year. Haptics, or feedback technology, on smartphones enables the user to feel a tactile sensation when interacting with an application.

Hui wrote:

We expected a stronger US dollar and higher costs for components such as memory and display to eventually hurt volume, as smartphone makers have to raise prices to offset the pressure. The lowering of full-year shipment targets by key Chinese smartphone makers supports our concern. We believe the stronger cost pressure is also holding back specification upgrades, as Apple and Samsung still control 77% of the Chinese smartphone market above RMB3,000.

For smartphones selling below RMB2,000, which account for 64% of the market, a metal casing can account for 10%+ of the bill of materials. To offset the cost pressure due to other components, our checks suggest smartphone makers, including even Samsung, will revert to plastic casings or adopt simpler metal housing designs for some new models. Therefore, we believe metal casing penetration is peaking out if not falling at the moment.

We believe dual-camera handset penetration will fail to match up to the aggressive forecasts on the street. For Oppo and Vivo, for example, our checks suggest they have removed any front-facing cams from most of their planned new models this year. For back-facing cams, they have cut the full-year volume forecasts by 30% and try to adopt simpler designs for some less important new models. The 5x zoom dual cam by Oppo presented at Mobile World Congress is just a demo and is unlikely go into mass production this year.

It adds RMB200-300 to costs for a smartphone to be IP67 water resistant like the iPhone 7. We expect at most a few, if any, Chinese smartphone models to earn the rating this year. Huawei claims the recently launched P10 has a water resistant structure without any certification. A piece of 3D glass costs almost RMB100, so is unlikely to be adopted by most even high-end models this year. We can completely ignore features like haptics which are not very visible to consumers.

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Interesting...is the competition on a decline...has Apple survived the stormy seas and calm waters are now on the horizon?