Samsung earnings disappoint amidst concerns of slowing smartphone growth

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  • Reply 41 of 91
    robin huberrobin huber Posts: 4,084member
    DrBlank's interesting last post got me to thinking. Samsung makes EVERYTHING. Their current dependence on phones for profit poses a risk for a company that specializes in not specializing. Apple DOESN'T try to make anything and everything. Now the purpose of Apple's current ad campaign becomes clearer to me. Like Samsung, Apple has a phone problem. Does it want to become primarily a phone company? Apple can use its phones as halo products to sell into its ecosystem. Samsung's phones don't help it to sell its washing machines. Very interesting to watch this play out.
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  • Reply 42 of 91
    stelligentstelligent Posts: 2,680member

    Quote:

    Originally Posted by Suddenly Newton View Post





    But I am drinking champaign.

    "Interesting" is in the eye of the beholder. So you tell me: why did you find my posting interesting enough to reply?


    I find most things interesting, including silly posts from people in the matrix who insist massive profits made be made by manufacturing, shipping and then burying phones. It was you who claimed to be disinterested and yet summoned the energy to inform us so.

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  • Reply 43 of 91
    drblankdrblank Posts: 3,386member

    Quote:

    Originally Posted by anonymouse View Post


     


    I think they try to release it when it won't have to compete with a new iPhone, toward the end of the cycle for the last one.



     


    Yeah, they want to have a head start.  Also, since Samsung is a supplier of certain components maybe Samsung drags their feet a little in supporting what Apple is doing.  I can't wait for Apple to be in a position when they aren't reliant on Samsung so much or at all.  I don't trust Samsung.  They might make decent components, but they aren't the only game in town. I wish Intel would have played ball and hooked up with Apple and supported Apple's ARM processors like they SHOULD have.  Intel can be arrogant when it comes to their processors and supporting someone else whether it's an Intel chip design or not.

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  • Reply 44 of 91
    lkrupplkrupp Posts: 10,557member

    Quote:

    Originally Posted by drblank View Post


    Apple has several problems to deal with.



     


    I don't agree with any of your points. Not a single one.

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  • Reply 45 of 91
    jungmarkjungmark Posts: 6,928member
    lkrupp wrote: »
    "<span style="color:rgb(24,24,24);font-family:arial, helvetica, sans-serif;line-height:18px;">Though Samsung Electronics reported a record operating profit for its June quarter, the number still came in below analysts' expectations, sending the company's stock tumbling on Friday."</span>


    <span style="line-height:18px;">Just like Apple. But will we start seeing tech blogs lamenting that Samsung has lost its mojo? Will we see articles instructing Samsung as to what it must do to survive? Will a chorus of wagging tongues start demanding that Samsung's CEO be replaced? Will the term"beleaguered" start to be used when referring to Samsung? Will there be cries of "no innovation" flying around? </span>


    <span style="line-height:18px;">I think we already know the answers to those questions don't we.</span>

    It's simple, Apple "fails" to innovate leaves Sammy nothing to copy.
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  • Reply 46 of 91
    stelligentstelligent Posts: 2,680member

    Quote:

    Originally Posted by drblank View Post


    1.  They don't have NTT and China Mobile signed up yet.  



    That's not a problem. It's an opportunity. 


     


    Quote:

    Originally Posted by drblank View Post


    2.  Apple has only announced basically one new model on a yearly basis, when they should be announcing more than that.  I think Apple has room to replace their existing iPhone 4 and 4S with an updated model that is their "low end" model which maybe Apple is planning on doing.  The other is getting a bigger screen phone, which is seriously hampering their growth.  I personally think that the market is definitely split up into three definite screen sizes and Apple needs to constantly address this.



    Should? They might choose to? But "should"? Come on ...


     


    Quote:

    Originally Posted by drblank View Post


    3. It's similar to the PC industry selling $400 laptops.  THERE IS NO MONEY IN IT, SO WHY BOTHER.  It's a cheap way of buying market share.



     


    Kind of like it. There is some money in it. But not in the same range as what they are making. Once in a while, Mercedes makes a cheaper sedan or whatever. But it is never a low end vehicle. That's kind of like it, too.


     


    Quote:

    Originally Posted by drblank View Post


    4. iOS obviously needs an fresh update, which it could have used last year, but obviously we have to wait until iOS 7 is finished, but so far, I personally like what I see and know that iOS 8 will just add even more features.



    iOS7 will not be "finished". It's a reset of iOS as we knew it. I think it's wrong to say they are doing this to forsake Scott Forstall's vision. I think they are doing this because (a) it's time, (b) they want a new UX that is harder to emulate and (c) they are incorporating new technology in the UX. Future versions (in the next few years) may as well be called iOS7.2, etc., much like the naming of MacOSX. I think they are also instilling uniformity more broadly. For example, I see they have recently adopted parallax scrolling on their website.


     


    Quote:


    Originally Posted by drblank View Post

     


    5.  I don't know how much pent up demand Apple has for their fingerprint ID technology to get released.  Individuals may not care as much as large customers, government, and military customers might be salivating for this technology in smartphones and tablets.  So, this is something we have to wait to see how much impact that's happening.



    I don't think Apple does things necessarily out of demand, at least not in the traditional way. They don't necessarily care what individuals care about. They are more interested in getting individuals to buy what they care about.

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  • Reply 47 of 91
    lkrupplkrupp Posts: 10,557member


    And still not any mention of Samsung's "disappointing" sales or the Android security breach on C|net or most other non Apple-centric blogs. Nothing.

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  • Reply 48 of 91
    jameskatt2jameskatt2 Posts: 722member
    Samsung is a very diverse company - making TVs, Refrigerators, Washing Machines, Computer Chips, Solid State Drives, Memory Chips, Cameras, etc.

    The fact that 70% of its profits are in smartphones goes to show how poorly the rest of the company is doing.

    If Samsung did not slavishly copy Apple's iPhone, they would be losing money.
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  • Reply 49 of 91
    robin huberrobin huber Posts: 4,084member
    stelligent wrote: »
    They don't necessarily care what individuals care about. They are more interested in getting individuals to buy what they care about.
    “If I had asked people what they wanted, they would have said faster horses.” Henry Ford
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  • Reply 50 of 91
    tallest skiltallest skil Posts: 43,388member
    “If I had asked people what they wanted, they would have said faster horses.” Henry Ford

    "People don't know what they want until you show it to them." –Steve Jobs

    By extension, people don't know what they'd care about until you show it to them.
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  • Reply 51 of 91
    rogifan wrote: »
    If Apple's going to do that then don't make it from cheap looking candy colored plastic. Who would spend $400 on that?

    This is Apple we are talking about. They know how to make plastic phones that don't look cheap. Remember the original iPhone?
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  • Reply 52 of 91
    kdarlingkdarling Posts: 1,640member

    Quote:

    Originally Posted by AppleInsider View Post




    Shares of Samsung lost nearly 4 percent after Samsung released guidance ahead of its full June quarter results, which will be reported on July 26. The company revealed that its operating profit grew 47 percent year over year to 9.5 trillion won, or $8.3 billion.

    ...



    Those fears became a reality this year, in the company's second quarter of fiscal 2013, when Apple saw its profits fall for the first time in a decade. The company's profits were down about 18 percent year over year to $9.5 billion, despite record second quarter sales of $43.6 billion.


     


    While we have to wait for Apple's current quarterly reports, the difference seems to be that YoY, Samsung's profits have been going up, while Apple's profits were down last quarter in spite of increased sales.


     


    If the high end (aka high priced) market is saturated, it will affect Apple more, because they started with huge profit margins and can only drop from there.  I think Cook has been trying to let everyone down easy, because he realizes that Apple needs to get into the lower profit margin regions. Plus he has said before that he does not intend to leave price umbrellas for competitors.


     


    Quote:

    Samsung has also become increasingly dependent on its smartphone business, with that segment of the company accounting for some 70 percent of its total profit. In contrast, iPhone sales account for about half of Apple's revenue.


     


    Hard to contrast profits and revenues.


     


    Doesn't the iPhone count for about 2/3 of Apple's profits?  Certainly iOS devices must.


     


    Quote:

    Originally Posted by matrix07 View Post


    If it's so rosy I wonder why they want to hide it. Do you?




     


    Why does Apple hide the sales ratio of the iPhone 5 vs the iPhone 4S and 4? 


     


    Answer: because such details would give valuable information to its competitors, and possibly worry investors.


     


    Quote:

    Originally Posted by BigMac2 View Post


    You misunderstanding the phone market, the iPhone is very far from being a very high margin product.  Too much patent and licence fee are attached to any cell phone technology.  



     


    The iPhone is very much a high margin product, despite paying up to $50 per phone for IP licenses.


     


    Their gross margin is well over 50%, and their net margin is likely close to 30%.  That's a lot.


     


    Quote:

    Originally Posted by lkrupp View Post


    Just like Apple. But will we start seeing tech blogs lamenting that Samsung has lost its mojo? 



     


    All sorts of articles out today saying things like that.   For example, USA Today's Samsung gets a taste of Apple's bitter pill, quotes Strategy Analytics as saying:


     


    ""Apple is suffering from iPhone fatigue, while Samsung is suffering from Galaxy fatigue," 

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  • Reply 53 of 91
    stelligent wrote: »
    I don't think Apple does things necessarily out of demand, at least not in the traditional way. They don't necessarily care what individuals care about. They are more interested in getting individuals to buy what they care about.

    They are more interested in getting individuals to buy what APPLE cares about.

    Apple has a vision for where computing is heading. They want you to buy into their vision.
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  • Reply 54 of 91
    tallest skiltallest skil Posts: 43,388member
    This is Apple we are talking about. They know how to make plastic phones that don't look cheap. Remember the original iPhone?

    Made of aluminum. Yes, I remember it.
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  • Reply 55 of 91
    robin huberrobin huber Posts: 4,084member
    This is Apple we are talking about. They know how to make plastic phones that don't look cheap. Remember the original iPhone?
    Does my memory fail me, or didn't the original iPhone have a metal back with the only plastic on it being a black radio "window" at the bottom? Perhaps you're thinking of the 3 series.
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  • Reply 56 of 91
    bigpicsbigpics Posts: 1,397member

    Quote:

    Originally Posted by stelligent View Post


    It is impressive how they earned these record profits by only shipping but not selling millions of phones. Now that's innovation.



     


    Does "operating profit" = "net profit" and are these figures directly comparable to the way Apple reports profit? 


    Quote:

    Originally Posted by BigMac2 View Post


     


    You misunderstanding the phone market, the iPhone is very far from being a very high margin product.  Too much patent and licence fee are attached to any cell phone technology.  Apple like everyone else has to pay big bucks for its 3G-LTE modem and other technologies integrated in phones these day, this is why carriers started to subsidize devices to their clients unwilling to pay the real price of it. 


     


    The real cash cow for Apple is not their products anymore but their services, the iTunes Stores and the whole iOS ecosystem is where Apple got their money from. 



     


    Well, someone's misunderstanding the market at least. 


     


    As I recall Apple makes relatively little on their "services" including those you've mentioned compared to their hardware SKU's.  And yes, they do make a healthy margin on their new phones.  From the beginning (with some minor back and forths including the too-late OS licensing period) Apple's always been a device company that offered exclusive software and software/content related services and more recently a broker for third party media and software.  The ecosystem's more a halo effect that helps keep the Apple marketing machine going - to date at least. 



    You are correct, though, in  that it is the CARRIERS (the ones who do) who subsidize the phones - not Apple (at least mostly from what we can infer).  Also, dunno if any manufacturer's been able to get the unprecedented terms during the subsidized contract period that Apple set as their own standard first with ATT and subsequently others, at least in the US.



    Or if any others have been able to avoid carrierware, bloatware, on-phone branding, control over when and how updates are released, and their entirely separate AppleCare operation (which I imagine also has a nice margin) as opposed to carrier associated extended warranty contracts.

     


    Quote:

    Originally Posted by Robin Huber View Post



    DrBlank's interesting last post got me to thinking. Samsung makes EVERYTHING. Their current dependence on phones for profit poses a risk for a company that specializes in not specializing. Apple DOESN'T try to make anything and everything. Now the purpose of Apple's current ad campaign becomes clearer to me. Like Samsung, Apple has a phone problem. Does it want to become primarily a phone company? Apple can use its phones as halo products to sell into its ecosystem. Samsung's phones don't help it to sell its washing machines. Very interesting to watch this play out.


     


    ^ Interesting line of thought... 


    Quote:


    Originally Posted by stelligent View Post


     


    iOS7 will not be "finished". It's a reset of iOS as we knew it. I think it's wrong to say they are doing this to forsake Scott Forstall's vision. I think they are doing this because (a) it's time, (b) they want a new UX that is harder to emulate and (c) they are incorporating new technology in the UX. Future versions (in the next few years) may as well be called iOS7.2, etc., much like the naming of MacOSX. I think they are also instilling uniformity more broadly. For example, I see they have recently adopted parallax scrolling on their website.


     


    I don't think Apple does things necessarily out of demand, at least not in the traditional way. They don't necessarily care what individuals care about. They are more interested in getting individuals to buy what they care about.



     


    Your post brought a possible (?) scenario to mind:  that iOS 10 may mark a fairly major transition and be the point at which a "semi-grand OS unification" is deemed to have occurred.



    I.e,  Mac OS and iOS may retain separate code bases and/or apps and/or whatever, but this might be the point at which we see a naming convention of "OS X Santa Cruz" and "iOS X Something" (whatever name series they choose for iOS)...  ...hmmm.  I know I like the notion....

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  • Reply 57 of 91
    genovellegenovelle Posts: 1,481member
    stelligent wrote: »
    Now Samsung is also disappointing analysts and investors with record profits. Is there no end to their copying of Apple? What will they do next - issue dividends and buy back shares? Fire their software head?

    It is impressive how they earned these record profits by only shipping but not selling millions of phones. Now that's innovation.
    When you buy parts from yourself and count shipped phones as sold but don't account for unsold phones until you give them away as buy one get one, you can show all kinds of profit
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  • Reply 58 of 91
    stelligentstelligent Posts: 2,680member

    Quote:

    Originally Posted by Robin Huber View Post





    “If I had asked people what they wanted, they would have said faster horses.” Henry Ford


     


    Quote:

    Originally Posted by Tallest Skil View Post





    "People don't know what they want until you show it to them." –Steve Jobs



    By extension, people don't know what they'd care about until you show it to them.


    Isn't that what I wrote already? Aren't my words good enough? You guys have echo me using Henry Ford and Steve Jobs? Sheesh ...

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  • Reply 59 of 91
    tallest skiltallest skil Posts: 43,388member
    stelligent wrote: »
    Isn't that what I wrote already?

    Not... really.
    stelligent wrote: »
    They don't necessarily care what individuals care about. They are more interested in getting individuals to buy what they care about.

    Because this isn't what we're saying. The they here refers to Apple, since the first sentence negates the possibility that it refers to individuals. Apple doesn't do that.
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  • Reply 60 of 91
    [QUOTE][I]Originally Posted by Suddenly Newton[/I]

    Of no particular concern.[/QUOTE]

    [QUOTE][I]Originally Posted by stelligent[/I]

    Then what's the point of mentioning anything. Why is it interesting to share what you are not concerned about?

    You might have written "not currently drinking champagne".[/QUOTE]

    It's called passive-aggression. Other examples include, "Yawn", "Meh" and "How is this news?".
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