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Samsung Electronics has not dethroned Apple, Inc. in mobile profits

post #1 of 137
Thread Starter 
A report by Strategy Analytics is getting lots of attention, but its core implication that Samsung Electronics is now leading Apple, Inc. in profits is simply not accurate.



Estimating figures Apple and Samsung don't actually provide



On Friday, Strategy Analytics issued a press release stating that "Samsung has finally succeeded in becoming the handset industry's largest and most profitable vendor," according to its "latest research."

Samsung has been making the most phones since the first quarter of 2012, when it passed Nokia to take the global handset crown. That means the only thing actually new in Strategy Analytics's statement is the claim that Samsung is actually making more profit than Apple, a long time leader in profitability across both mobile devices and desktop PCs.

Strategy Analytics has to employ "research" to come up with this claim because Samsung doesn't actually report how many phones, smartphones, tablets, cameras or set top boxes it sells (or even the inventory numbers it ships) and doesn't report the profit share of any of these products segments.

Apple does report specific unit sales of product segments, and often provides additional detail on inventory shipments (clarifying how many devices actually sold compared to how much inventory it shipped into the channel). But Apple doesn't break down profit share by product segments either.

Strategy Analytics is attempting to estimate mobile handset profit shares for both companies. While it generated a lot of coverage for its report, the numbers not only don't reflect reality, but they were further mangled by sloppy reporting from a variety of major tech websites.

The straight facts on profits



Before looking at analyst estimates, look at the actual figures reported by Apple and Samsung for the quarter ending in June (Samsung's Q2 and Apple's Fiscal Q3 both relate to the same quarter).

Apple in its 10Q filing reported $9.2 billion in total operating income. After $2.5 billion set aside for taxes, that leaves $6.9 billion in net income.

Apple 10Q
Source: Apple 10Q


Samsung Electronics reported (PDF) $9.53 trillion Korean Republic Won ($8.56 billion) in total operating income. After $2.05 T KRW ($1.84 billion) set aside for taxes, that leaves $7.77 T KRW ($6.98 billion) in net income.

(All currency translations here were performed today using data from Google, which is slightly more flattering, but not significantly different, than the currency exchange at the time the results were stated).

Samsung profits
Source: Samsung


Comparing Apple's to Samsung's



Apple is earning greater operating profits than all of Samsung Electronics, despite the fact that Samsung operates across a lot of other businesses. Apple sets aside more for taxes, so its reported net profit is slightly but not significantly lower, at least in the current currency exchange.

Samsung further breaks its overall earnings into three market segments: Consumer Electronics (TVs and appliances), IT & Mobile communications (which includes handsets, smartphones, tablets, PCs and network equipment) and Device Solutions (which includes LCD and OLED screens, memory, and System LSI, the fab that builds Apple's A-series chips for iOS devices).

Samsung profits
Source: Samsung


If you only compare the IM segment of Samsung that directly compares to Apple's business (iPhones, iPads, iPods and Macs), you get $6.28 T KRW ($5.64 billion) in operating profit (Samsung doesn't detail its taxes or net income for IM). That amounts to just 61 percent of Apple's total earnings.

Tech media mangles the data



Reporters had a hard time presenting this information. An initial report by Steve Kovach of BusinessInsider proclaimed "Samsung Made $1.43 Billion More In Profit Than Apple Last Quarter, " before the site realized that it was comparing Apple's after tax net income to Samsung Electronics pre-tax operational income.

The site subsequently corrected its story with a new, less racy headline "How Samsung's Profit Compares To Apple's," but the incorrect "news" was widely syndicated by others, and still appears, uncorrected, on the site's Australian edition.


Source: Business Insider


A Google search for the original, incorrect headline "Samsung Made $1.43 Billion More In Profit Than Apple Last Quarter " returns 6,650 results. Some of those syndicated reports have been corrected, including those by the San Francisco Chronicle and Yahoo Finance. Many other blog entires have not, such as this one by Cult of Android.

Even the corrected version still mixes up "net profit" for "operational profit," and says that Samsung doesn't report net profit (the company does, as shown above).

A report by CNET described Samsung's IM earnings as its "mobile business," obscuring the reality that this group, even its "mobile" subgroup that excludes networking sales, also sells all of Samsung's PCs and tablets.

That report noted that IM accounts for about two thirds of Samsung Electronics' revenue, and had declined by 3.5 percent over the previous quarter. That decline occured despite the fact that Samsung had launched its new flagship Galaxy S4 smartphone in April. In contrast, Apple's sales for the quarter represented the third quarter of its iPhone 5 flagship.

Strategy Analytics compares all of Samsung's IM to just the iPhone



Three days after BusinessInsider corrected its report, Strategy Analytics introduced its own that compared its "estimated" $5.2 billion for Samsung's "operating profit for its handset division" with "an estimated iPhone operating profit of $4.6 billion."

Samsung's "handset division" doesn't just sell handsets, as the company itself outlines in its breakdown of the IM division (below). It doesn't even refer to its IM Mobile segment as a "handset division." So at Samsung, IM Mobile includes tablets and PCs, everything other than its networking gear.

Samsung profits
Source: Samsung


Strategy Analytics estimates that $5.2 billion of the $5.64 billion in operating profits Samsung reported for IM is non-network related, but this "mobile" figure also includes all of Samsung's Windows PC sales, Chromebooks and Galaxy tablets.

Apple doesn't report profits for iPhone. It does report net sales by regional/retail operating segment and by product category: iPhone, iPad, Mac, iPod, iTunes Software & Services, and Accessories. In overall revenue generation, iPhone accounts for 51 percent of Apple's business.


Source: Apple


Where did Strategy Analytics get its "estimated iPhone operating profit of $4.6 billion"? Some reverse engineering (below) exposes an algorithm of division by two.


Source: Math


In other words, in order to report that "Samsung has finally succeeded in becoming the handset industry's largest and most profitable vendor," Strategy Analytics had to compare Samsung's entire PC and device business with only half of Apple's.Strategy Analytics had to compare Samsung's entire PC and device business with only half of Apple's.

That's based on the faulty assumption that Apple earns the same profits on iPhone as it does across the rest of its business. Apple doesn't report margins for each business segment, but it is well known that Apple earns more from iPhone sales than from other product segments.

Apple has publicly stated that its overall profit margins in 2013 were significantly lower due to "a higher mix of new and innovative products with flat or reduced pricing that have higher cost structures and deliver greater value to customers and anticipated component cost and other cost increases." Sales of the iPad mini, for example, helped drive Apple's industry leading margins down.

Canaccord Genuity contrasted Apple's 35-40 percent mobile device margins with those of the rest of the industry. Samsung is in second place with margins of 20-22 percent. Every other company on its list reported profit margins in the single digits, with most of them actually losing money.

Canaccord Genuity
Source: Canaccord Genuity


By simply cutting Apple's reported profits in half to estimate the profits it earns on the iPhone, Strategy Analytics paints a false picture of Apple's profitability, quite obviously just to fuel a sensationalist headline.

A racy headline to draw attention to Strategy Analytics' report



Essentially, Strategy Analytics is suggesting that Samsung has no real PC or tablet business at all and that its entire range of handset sales (from feature phones to phablets) should be compared to revenue-based estimates of just one of Apple's products. Looked at honestly, Apple and the entirety of Samsung Electronics are both making nearly equal amounts of money, but Samsung is relying on much larger volumes of lower quality products to keep up.

Even with this logic, the "lead" Strategy Analytics gives all of Samsung's PC and mobile devices over just the iPhone is mere $600 million, less than the impact of currency fluctuations.

As BusinessInsider realized, it's not nearly as exciting to just report the fact that Apple reported profits of $9.2 billion and Samsung $8.56 billion, overall figures that are similarly just $600 million apart.

Samsung has consistently sold around twice as many total handsets as Apple has over the past year, but the devices Samsung sells are mainly low end models that contribute to very low profits.

Looked at honestly, Apple and the entirety of Samsung Electronics are both making nearly equal amounts of money, but Samsung is relying on much larger volumes of lower quality products to keep up.

More interesting information comes directly from Apple and Samsung



Strategy Analytics's "division by two" profit "estimates" press release was picked up and uncritically published by a variety of sources, including Juliette Garside of the Guardian UK, David Murphy of PC Mag, Tim Worstall of Forbes, Christopher Harress of London's International Business Times, Don Reisinger of CNET, Ryan Knutson of the Wall Street Journal, Kevin C. Tofel of Gigaom, Zach Epstein of Boy Genius Report, Matt Clinch of CNBC, and a report by BBC News.

[Update: Murphy has called attention to the issue in a promptly updated article for PC Mag

Matt Clinch of CNBC addressed the discrepancy on Monday, disparaging AppleInsider as an "Apple fan website" that only claimed an opinion "that Apple and Samsung Electronics were likely to be making similar profits."

July 30, 2013
]

Google lists 833,000 search results for "Strategy Analytics profits Apple Samsung," more than 3 times the results it returns for the "Samsung pays Apple in nickels" hoax.

Strategy Analytics' "news" overshadowed more interesting information from the companies themselves. Samsung's executives reiterated the warnings they began sounding in January, seeking to explain why the company's high end smartphones aren't selling better.

A report by Aaron Back of the Wall Street Journal described Samsung executives as being "in defensive mode."

It noted that "Samsung's shares have fallen 15% since the end of May on concerns about sales of the company's flagship Galaxy S4 phone," and that "operating profit for the [IM] segment fell by 3% from the previous quarter, partly due to higher marketing costs to push sales of the S4."

Profits for Samsung's other divisions fared better; earnings from its component business, which supply Apple, were up 73 percent. But Samsung is at risk of losing a significant chunk of Apple's business.

At the same time, chips and displays only account for 31 percent of Samsung's overall profits, most of which come from its mobile sales.

Samsung leads Apple in worrying about future sales



Apple's executives, on the other hand, noted that despite being in the cyclically slow third quarter of iPhone 5, the company set a record for iPhone sales in the June quarter.I don?t subscribe to the common view that [?] the smartphone market has hit its peak. I don?t believe that" - Tim Cook

Asked about fears of "increasing concerns that the high end of the smartphone market is reaching saturation point and that growth may be harder to come by," Apple's chief executive Tim Cook replied:

"I don?t subscribe to the common view that the higher-end, if you will, the smartphone market has hit its peak. I don?t believe that, but we?ll see and we?ll report our results as we go along."

Analyst Horace Dediu of Asymco addressed the "Peak Smartphone" fears in detail, concluding, "to summarize, with penetration now at about 60% in the US, the rate of adoption of smartphones is not slowing in any perceptible way."


Source: Asymco


With Samsung sending out distress signals about the sustainability of its high volume, low quality business model for phones in a market where Apple continues to grow, Strategy Analytics' creative accounting designed to award Samsung with an contrived achievement appears to be a distraction from reality, rather than real information.
post #2 of 137

We don't even know if samsung makes more phones than Apple does, even.  They don't release sales numbers... something even Apple Insider doesn't seem to get. 

 

Samsung does not release sales numbers, because the sales are anemic. 

post #3 of 137
Very good article!

Although not directly within the scope of this article, we may note that Apple sold 100 millions iPads in less than two years, that is huge!
post #4 of 137
Quote:
Originally Posted by Jessi View Post

We don't even know if samsung makes more phones than Apple does, even.  They don't release sales numbers... something even Apple Insider doesn't seem to get. 

 

Samsung does not release sales numbers, because the sales are anemic. 

 

It's true we don't know exactly how many phones Samsung sells (or tablets, or the feature/smartphone split, or how many are Android/WP). But we can estimate ballparks, and can look at usage data, surveys and other information to make reasonably intelligent conclusions and predictions.

 

The "analysis" that went into comparing all of Samsung's profits against half of Apple is not very astute though. It's also shameful that nobody from bloggers to journalists investigated the claim with even the most delicate finger scratching of sanity checks.

 

It is pretty interesting that Samsung's entire chip fab/LCD/memory, TV & appliances AND mobile/PC businesses combined are still earning less than Apple.

post #5 of 137
There seems to be a lack of morality, credibility, and integrity in the majority of those Apple bashing articles. It's my understanding that Samsung does not break out number of tablets or smart phones shipped/sold each quarter but we get these negative articles daily of apple's demise. Of course they are always followed by Apple spokesman declined to comment, and Samsung's spokensman could not be immediately reached. Is it really that serious to put out such misinformation. If coke and pepsi can coexist without all of this drama, surely apple and samsung can.....
post #6 of 137

Both Apple and Samsung make more money than I do.

 

I have no facts or evidence to support this.

post #7 of 137

Long Live AI. :)

 

Thank You!

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post #8 of 137
Quote:
Originally Posted by rumormill View Post

There seems to be a lack of morality, credibility, and integrity in the majority of those Apple bashing articles.

 

DED doesn't bashing Apple.


Edited by DroidFTW - 7/27/13 at 5:21pm
post #9 of 137

The interesting thing for me about these facts is that Samsung does the same stupid trick as Microsoft in that they blend in returns and sales numbers from completely unrelated areas to make the numbers appear better.  This is so obviously deceptive.  They might as well hang up a sign that says "We're full of shit and trying to hide something from you."  I don't know why companies don't get called out on this more.  Is it standard practice or something? 

 

Apple may be secretive with their financials, but they never play this kind of lame shell game.  What they do reveal is straightforward and honest. 

post #10 of 137
So, when the numbers look good for Apple, you're happy to declare that Apple takes the lion share of smartphone profits but now that they might look good for Samsung.... it's impossible to calculate anyone's profits accurately?

Funny stuff. 1biggrin.gif
post #11 of 137
Quote:
Originally Posted by Gazoobee View Post

 I don't know why companies don't get called out on this more.  Is it standard practice or something?  

 

It's standard practice to divulge only what's legally required.  If a company can make it harder for their competitors to know their true financials, they will certainly do so.  The less the competitors know, the better.

post #12 of 137
Quote:
Originally Posted by RichL View Post

So, when the numbers look good for Apple, you're happy to declare that Apple takes the lion share of smartphone profits but now that they might look good for Samsung.... it's impossible to calculate anyone's profits accurately?

Funny stuff. 1biggrin.gif

 

All of the companies in the report you linked to above are mobile phone companies:  RIM, Motorola, Nokia, HTC, and Sony Ericsson.  Relatively easy to see how much they're making because phones are all they make.  Samsung is a whole different beast.  But I suspect you already know that.  Funny stuff indeed.  

post #13 of 137
I'm disappointed DeD used Google so much. We all know Google will fake that calculator to make Samsung's numbers look better
post #14 of 137
Quote:
Originally Posted by Jessi View Post

We don't even know if samsung makes more phones than Apple does, even.  They don't release sales numbers... something even Apple Insider doesn't seem to get. 

 

Samsung does not release sales numbers, because the sales are anemic. 

Samsung certainly sells more phones than Apple 0.o


If you think otherwise, you are a bit off.

Now, do most of their phones have the build quality of Apple's phones?  Probably not.  Well, if your talking about the iPhone 5.,... Why Apple went a glass back I will never know (I do own an iPhone 4, it looks nice, but I would hate to ever drop it)

Quote:
Originally Posted by DroidFTW View Post

 

It's standard practice to divulge only what's legally required.  If a company can make it harder for their competitors to know their true financials, they will certainly do so.  The less the competitors know, the better.

Yup.  I am surprised people don't know/haven't realized this.

does anyone know if Samsung does a K20?  Someone(s) could look through that, might find a better answer (at least fine the profits and then do ASP to find # of phones, etc, etc, etc)

-QAMF

 


Edited by QAMF - 7/27/13 at 8:30pm

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post #15 of 137
Quote:
Originally Posted by Jessi View Post

We don't even know if samsung makes more phones than Apple does, even.  They don't release sales numbers... something even Apple Insider doesn't seem to get. 

 

Samsung does not release sales numbers, because the sales are anemic. 


I wish my income from anaemic sales was like Samsung's then.  Profit of $8.5 billion in the last quarter, the relatives must all be gathered round the bedside waiting for the heart monitor to flatline and the alarm to go off.

post #16 of 137
Quote:
Originally Posted by QAMF View Post

… Yup.  I am surprised people don't know/haven't realised (sic) this. ...

 

 

Well I do realise that, but that misses my point.  My point was, if a company is purposely deceiving you by releasing massaged financials, why wouldn't someone call them out on it?  Why would anyone invest in that company?  Why are such companies routinely reported on but this aspect isn't mentioned or highlighted?  It suggest that deception is a central part of the game (something business analysts routinely deny BTW), and that everyone is sort of okay with that.  

 

Sounds fucked up to me. 

post #17 of 137
Quote:
Originally Posted by eponymous View Post

All of the companies in the report you linked to above are mobile phone companies:  RIM, Motorola, Nokia, HTC, and Sony Ericsson.  Relatively easy to see how much they're making because phones are all they make.  Samsung is a whole different beast.  But I suspect you already know that.  Funny stuff indeed.  

Really? Motorola doesn't make anything but mobile phones?
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post #18 of 137
Quote:
Originally Posted by RichL View Post

So, when the numbers look good for Apple, you're happy to declare that Apple takes the lion share of smartphone profits but now that they might look good for Samsung.... it's impossible to calculate anyone's profits accurately?

Funny stuff. 1biggrin.gif

 

The difference between what you linked to and what's being said here here isn't simply a matter of what company is being flattered by the data presented. It's the difference between a true report of known data (published corporate profits) and a blatantly dishonest representation of made-up numbers as "facts." 

 

Can you not see that, or do you realize that you are spreading false information to muddy the water with phony controversy? 

 

There's absolutely no question that Apple makes more profit than all of Samsung Electronics. No question.

 

You could argue about whether a certain group of Samsung's phones by themselves make more or less money than Apple's iPhone itself, but there simply aren't any real facts to support that argument. And the way the two companies report their earnings (how they categorize expenses such as R&D, marketing and other financial details) make such guestimates a rather pointless exercise. 

 

Their claim is a bit like comparing Apple's Mac sales against the unit sales of all Windows PCs and Windows Tablets, while excluding the iPad. Which is also exactly what IDC and Gartner were doing. It's called lying with statistics. 

 

What's most interesting is that Strategy Analytics came up with a quite obviously bullshit claim that virtually everyone accepted as both fact and newsworthy, even though it is a pretty meaningless statement that isn't supported by any facts. They did it because journalists are lazy and they don't want to do any work because there's not much money in writing news anymore. That's a bad deal for open markets and democracy. But Google ads make everything free! 

post #19 of 137
Quote:
Originally Posted by jragosta View Post


Really? Motorola doesn't make anything but mobile phones?

 

The discussion was "how much they're making." Motorola loses money. $342 million in the last quarter. 

post #20 of 137
Finally someone is picking up on this. Of course I really don't care who's more profitable; but I do care about being accurate and factual. Most sites that reported this didn't throw out the disclaimer that these were estimates on the part of Strategy Analytics and not official figures from Apple and Samsung.

Another great thing about this story is it knocks down the fallacy I often see that Apple is supposedly doomed because 70% of its business comes from iPhone. Clearly that's not the case as indicated by their SEC filing.
post #21 of 137
Quote:
Originally Posted by DroidFTW View Post

It's standard practice to divulge only what's legally required.  If a company can make it harder for their competitors to know their true financials, they will certainly do so.  The less the competitors know, the better.
Hence why Apple doesn't report operating profits for iPhone, iPad, Mac etc. Or doesn't provide sales figures by model.
post #22 of 137
Quote:
Originally Posted by jragosta View Post


Really? Motorola doesn't make anything but mobile phones?

 

Perhaps a bit of an overstatement.  I though the split went through in 2010, but it was actually 2011.  Still, Motorola's FY 2010 statement clearly distinguishes between Devices and Home revenue.  

post #23 of 137
Quote:
Originally Posted by jragosta View Post

Really? Motorola doesn't make anything but mobile phones?
Basically mobile phones and accessories. I don't think they're making tablets anymore are they?
post #24 of 137
Quote:
Originally Posted by DroidFTW View Post


DED doesn't bashing Apple.

Typing on your Droid, eh?
post #25 of 137
Quote:
Originally Posted by DroidFTW View Post

Quote:
Originally Posted by Gazoobee View Post

 I don't know why companies don't get called out on this more.  Is it standard practice or something?  

It's standard practice to divulge only what's legally required.  If a company can make it harder for their competitors to know their true financials, they will certainly do so.  The less the competitors know, the better.

That's why, as DED points out, pretty much all of this type of reporting is -- I am paraphrasing -- crap.
post #26 of 137
Quote:
Originally Posted by Rogifan View Post

Hence why Apple doesn't report operating profits for iPhone, iPad, Mac etc. Or doesn't provide sales figures by model.

You can dissemble all you want, but none of the others come close to Apple in terms of the quality and quality of information provided every quarter.
post #27 of 137
Quote:
Originally Posted by anantksundaram View Post

You can dissemble all you want, but none of the others come close to Apple in terms of the quality and quality of information provided every quarter.
I'm not arguing that they don't. Just that they're not going to report things which might give competitors an advantage. I know some people complain that they don't break out iPhone and iPad sales by model, but why should they? Who really needs to know besides Apple?
post #28 of 137
Quote:
Originally Posted by RichL View Post

So, when the numbers look good for Apple, you're happy to declare that Apple takes the lion share of smartphone profits but now that they might look good for Samsung.... it's impossible to calculate anyone's profits accurately?

Funny stuff. 1biggrin.gif

Um... No.

This article is in response to the articles posted by supposedly-reputable news sources that have (often mis-)quoted a crap analysis made on horrible data.

Please kindly similarly analyse the data from the article you mention, or GTFO.
post #29 of 137
Not a great name for a market research firm - Stategy Analytics. Their name implies there's stategy in gaming their analytics.
post #30 of 137
Quote:
Originally Posted by Rogifan View Post

Basically mobile phones and accessories. I don't think they're making tablets anymore are they?

Nonsense. You didn't say "Motorola Mobility". You said "Motorola" - which makes an enormous range of products.
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post #31 of 137
Quote:
Originally Posted by Gazoobee View Post

 

Well I do realise that, but that misses my point.  My point was, if a company is purposely deceiving you by releasing massaged financials, why wouldn't someone call them out on it?  Why would anyone invest in that company?  Why are such companies routinely reported on but this aspect isn't mentioned or highlighted?  It suggest that deception is a central part of the game (something business analysts routinely deny BTW), and that everyone is sort of okay with that.  

 

Sounds fucked up to me. 

That is what K20 forms are for.

Honestly, people talk about how great capitalism is, and, the truth of the matter is, companies not disclosing this information is because of capitalism.  (insert rant about various economic systems and how people expect them to be based on what they really are here)

Quote:
Originally Posted by jragosta View Post


Nonsense. You didn't say "Motorola Mobility". You said "Motorola" - which makes an enormous range of products.

Agreed.

-QAMF

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post #32 of 137
Quote:
Originally Posted by NoTown View Post

Not a great name for a market research firm - Stategy Analytics. Their name implies there's stategy in gaming their analytics.

At least they are honest about their intentions.
post #33 of 137
Quote:
Originally Posted by Gazoobee View Post

Well I do realise that, but that misses my point.  My point was, if a company is purposely deceiving you by releasing massaged financials, why wouldn't someone call them out on it?  Why would anyone invest in that company?  Why are such companies routinely reported on but this aspect isn't mentioned or highlighted?  It suggest that deception is a central part of the game (something business analysts routinely deny BTW), and that everyone is sort of okay with that.  

Sounds fucked up to me. 

Because that's how it's always been done. Apple does some hiding of their own. They report iPhone sales but never a breakdown of models and the same goes with every other device.
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post #34 of 137
Quote:
Originally Posted by eponymous View Post

All of the companies in the report you linked to above are mobile phone companies:  RIM, Motorola, Nokia, HTC, and Sony Ericsson.  Relatively easy to see how much they're making because phones are all they make.  Samsung is a whole different beast.  But I suspect you already know that.  Funny stuff indeed.  

Not quite so. Some of these also make mobile infrastructure and networking gear, i.e. the stuff companies like AT&T use to operate their cellular networks.
post #35 of 137
Quote:
Originally Posted by Corrections View Post
Quote:
Originally Posted by Jessi View Post

We don't even know if samsung makes more phones than Apple does, even.  They don't release sales numbers... something even Apple Insider doesn't seem to get. 

 

Samsung does not release sales numbers, because the sales are anemic. 

It's true we don't know exactly how many phones Samsung sells (or tablets, or the feature/smartphone split, or how many are Android/WP). But we can estimate ballparks, and can look at usage data, surveys and other information to make reasonably intelligent conclusions and predictions.

As stated earlier, we know they sell more than Apple.  Even in just smartphones they do.  But, Apple is a premium brand, and Samsung (while it makes some premium phones) makes a lot of non-premium products which not only are cheaper for consumers (compared to the newest iPhone) but also are cheaper for phone companies.  Giving those companies a larger incentive to sell them.

 

Quote:
Originally Posted by Corrections View Post
It is pretty interesting that Samsung's entire chip fab/LCD/memory, TV & appliances AND mobile/PC businesses combined are still earning less than Apple.

Not really, most of those are relatively low margin biz, and Memory/LCD have been having tough times (terms of profits) for at least 2-3 years from my memory.

Apple makes premium products and GENERALLY charges a premium price over competitors (looking only at the hardware).  

For example, my Lumia 920 has far more technologies than either the iPhone 5 has, but it cost be under half the price an iPhone 5 with 32GB (only storage capacity for the Lumia) did.  Normally it would only cost about 35-40% less, but that is still a large premium considering it has: NFC, wireless charging, larger battery, larger screen (with a slightly higher pixel density) (still IPS thankfully!), and other stuff like how it has a mode that works with gloves (and finger nails, etc,etc)

I got it because I wanted to play with W8P, to be honest, I was not expecting to fall in love with W8P.  I was planning on keeping using my iPhone 4 (and eventually moving onto whatever the next iPhone will be called).


Anyhow, in addition, the fab/LCD/memory lines are things that Apple is by far the largest buyer of (to my knowledge) Apple knows how to play the supply chain well, they get lowest possible prices.

-QAMF

note: Sorry for getting so off topic

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post #36 of 137
Quote:
Originally Posted by Gazoobee View Post

The interesting thing for me about these facts is that Samsung does the same stupid trick as Microsoft in that they blend in returns and sales numbers from completely unrelated areas to make the numbers appear better. 

 

How do they blend returns and sales numbers if they don't report either?

 

Quote:
Originally Posted by eponymous View Post

All of the companies in the report you linked to above are mobile phone companies:  RIM, Motorola, Nokia, HTC, and Sony Ericsson.  Relatively easy to see how much they're making because phones are all they make.  Samsung is a whole different beast.  But I suspect you already know that.  Funny stuff indeed.  

 

If you mean revenue, Samsung often announces it for their handset division in their investor press releases.  For example, this one for 4Q12 said:

 

"The IT & Mobile Communications – comprised of Mobile Communications, Telecommunication Systems, Digital Imaging and Media Solution Center businesses – posted operating profits of 5.44 trillion won on 31.32 trillion won in revenue for the period. Out of the total IM earnings, the handset-making unit claimed 27.23 trillion won in revenue in the October-December quarter."

 

So about 87% of the IM division's revenue came from phones, which is handy to know for estimating future quarters.

 

Quote:
Originally Posted by jragosta View Post

Really? Motorola doesn't make anything but mobile phones?

 

The part of Motorola that Google owns now, makes just Mobile phones and accessories, including the MotoActv watch.

post #37 of 137
Forget all the fine details. Everyone is happy to hear that Samsung is beating the crap out of Apple in profits whether it's actually true or not. Let them enjoy the doom-ation of Apple if it makes them happy. Wall Street certainly doesn't care one way or another. Wall Street only knows that Apple's ass is being beaten in market share by Samsung and that's enough to perpetually keep Apple's share price down in the toilet. The hedge fund managers are tremendously fearful that Apple has lost its touch and they can make a lot more money by backing legitimate companies like Amazon where they know they've got a sure thing when they see it. Apple is too iffy an investment. Hedge funds only back sure things.

One thing for certain, Apple should never have let Samsung get even close to them. Apple should never have allowed Samsung to dominate the smartphone market in less than a year. Apple pulled a bonehead move by not doing anything for nearly nine months. What's the point of Apple having a mountain of reserve cash if they're not going to use it to protect themselves from weaker rivals. Samsung will soon own the bottom, the mid-tier and maybe even the top-tier smartphone market without even breaking a sweat. Samsung can put out six models of smartphones for every one Apple puts out. Each having a different feature that's better than whatever feature the iPhone has.

Well, good luck, Apple. You're going to have to beat off Samsung with a stick because everything Apple does, Samsung is going to copy it and add more features and then sell it for less money. Wall Street loves that price undercutting strategy and that's why Amazon is so favored by Wall Street investors.
post #38 of 137
Quote:
Originally Posted by Constable Odo View Post

One thing for certain, Apple should never have let Samsung get even close to them.

It's called lawsuits.
Quote:
Apple should never have allowed Samsung to dominate the smartphone market in less than a year.

They issued lawsuits.
Quote:
Apple pulled a bonehead move by not doing anything for nearly nine months.

They issued lawsuits.
Quote:
What's the point of Apple having a mountain of reserve cash if they're not going to use it to protect themselves from weaker rivals.

So they can issue lawsuits.
Quote:
Samsung can put out six models of smartphones for every one Apple puts out.

No. They DO. Saying can implies that Apple cannot.

Basically you want Apple to have hired SEAL team 6 to kill off Samsung's executives and engineers. That's really all they could have done other than what they did.

Originally posted by Marvin

Even if [the 5.5” iPhone] exists, it doesn’t deserve to.
Reply

Originally posted by Marvin

Even if [the 5.5” iPhone] exists, it doesn’t deserve to.
Reply
post #39 of 137

That is some fine reporting! Great job! 

post #40 of 137
Quote:
Originally Posted by jragosta View Post


Really? Motorola doesn't make anything but mobile phones?

 

Actually, they don't if you consider the right Motorola.

 

From Wikipedia: "On February 11, 2010, Motorola announced its separation into two independent, publicly traded companies, effective Q1 2011. The official split occurred at around 12:00 pm EST on January 4, 2011. The two new companies are called Motorola Mobility (owned by Google; cell phone and cable television equipment company) and Motorola Solutions (NYSEMSI; Government and Enterprise Business)."

 

And if you think Motorola's Set Top Box business is significant: "On April 17, ARRIS Group, Inc. (NASDAQ: ARRS) announced that it completed its acquisition of the Motorola Home business from a subsidiary of Google Inc."

 

So, now Motorola Mobility is selling cellphones only. And not making a lot of them either:)

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