Only one third of Samsung's smartphone sales are in the class of Apple's iPhone
In a meeting with its concerned investors on Wednesday, the head of Samsung Mobile revealed numbers illustrating that the company sold fewer high end smartphones than Apple this year, and that only about a third of the company's total "smartphone" shipments are of a class really comparable to the iPhone.
A report by Jungah Lee for Bloomberg cited Samsung's chief financial officer Lee Sang Hoon as saying, "Going forward, we will expand our mergers-and-acquisitions strategy beyond a few target areas to pursue opportunities across a wide range of fields."
Samsung said it has only spent around $1 billion on 14 different acquisitions since 2010. That's a far cry from Google, which has averaged one acquisition per week over that period, and even much less than Apple, which recently announced having made 15 "strategic acquisitions" over the past year.
That's a sugar coated version of what Samsung reported in its latest quarterly earnings report, where it clearly stated: "total shipments [of smartphones were] up QoQ led by increased sales of mass-market models," but "high-end model shipments stayed at similar level QoQ."
In stark contrast, Apple's iPhone sales were up 26 percent over the year ago quarter, setting a new volume record for the September quarter. All of Apple's smartphones are "high end," unlike the outdated, 2008-era Galaxy Y model Strategy Analytics Executive Director Neil Mawston cited as an example of the "mass-market models" he said were helping to "lift" Samsung's volumes.
Samsung rarely provides firm numbers for actual smartphone sales, nor does it regularly detail how many are "high end" iPhone competitors and how many are simply basic camera-phones running an old version of Android 2.x, and sold at razor thin profit margins.
Strategy Analytics has become famous for lumping these sales together to award Samsung for being the global smartphone leader, despite the fact that Samsung Mobile earns much less profit (over $1 billion less, below) than Apple despite its much larger numbers of smartphone shipments (more than 3.5x, above).
According to a (Korean language; machine translated) report by ETNews, Samsung targets total "smartphone" sales this year at 300-310 million, and plans to sell around 360 million in 2014, of which about 126 million will be "premium models."
That report described Samsung's flagship Galaxy S4 as having "sluggish sales this year," and referenced the firm's "the low-end model-driven business strategy." The company originally projected that the Galaxy S4 would sell 100 million units a year on its own, before sales collapsed this spring shortly after its launch.
Samsung's current sales and future plans consistently describe that only around one third of Samsung's "smartphones" are actually comparable to Apple's current iPhones, albeit being a generation behind.
Samsung's U.S. Galaxy S4 handles benchmarks slightly slower than Apple's iPhone 5c (which is very similar to the iPhone 5 Apple released last year), while all of Samsung's smartphones still lack the 64-bit power and extended battery efficiency of Apple's A7-powered iPhone 5s flagship.
Over the last fiscal year, Apple reported sales of 150 million iPhones. Unlike Samsung, Apple is not reporting an end to high end sales growth. Instead, Apple's high end is growing faster (26 percent) than than the overall phone industry (7 percent), according to CNET.
That's a serious problem for Samsung, which makes about two thirds of its total profits from smartphone sales. Apple also relies very heavily upon iPhone sales, but it also has profitable Mac, iPad and iTunes, software and service related businesses, which generate ten times the profit of Samsung's struggling Chromebook netbook, Android tablet and Windows PC sales.
Disregard sales, acquire companies
Samsung's investor meeting, intended to instill confidence in investors worried about flattening sales of profitable, high end smartphones, focused attention on the company's stated plans to accelerate the pace of its acquisitions.A report by Jungah Lee for Bloomberg cited Samsung's chief financial officer Lee Sang Hoon as saying, "Going forward, we will expand our mergers-and-acquisitions strategy beyond a few target areas to pursue opportunities across a wide range of fields."
Samsung said it has only spent around $1 billion on 14 different acquisitions since 2010. That's a far cry from Google, which has averaged one acquisition per week over that period, and even much less than Apple, which recently announced having made 15 "strategic acquisitions" over the past year.
Is Samsung beating Apple in smartphones?
The Bloomberg report stated that "the company, which overtook Apple Inc. (AAPL) in smartphones, has used sales of cheaper handsets in emerging markets to stoke earnings in mobiles as growth in high-end devices slows amid market saturation."That's a sugar coated version of what Samsung reported in its latest quarterly earnings report, where it clearly stated: "total shipments [of smartphones were] up QoQ led by increased sales of mass-market models," but "high-end model shipments stayed at similar level QoQ."
In stark contrast, Apple's iPhone sales were up 26 percent over the year ago quarter, setting a new volume record for the September quarter. All of Apple's smartphones are "high end," unlike the outdated, 2008-era Galaxy Y model Strategy Analytics Executive Director Neil Mawston cited as an example of the "mass-market models" he said were helping to "lift" Samsung's volumes.
Samsung rarely provides firm numbers for actual smartphone sales, nor does it regularly detail how many are "high end" iPhone competitors and how many are simply basic camera-phones running an old version of Android 2.x, and sold at razor thin profit margins.
Strategy Analytics has become famous for lumping these sales together to award Samsung for being the global smartphone leader, despite the fact that Samsung Mobile earns much less profit (over $1 billion less, below) than Apple despite its much larger numbers of smartphone shipments (more than 3.5x, above).
Samsung's ships two-thirds as many Galaxy S, Note as Apple's iPhone
However, the Bloomberg report noted, in passing, at its very end a comment made by Samsung's mobile chief Shin Jong Kyun, who outlined at the investor event (as portrayed on Samsung's slide below) that "the company will sell a combined 100 million units of its Galaxy S and Note series handsets this year."According to a (Korean language; machine translated) report by ETNews, Samsung targets total "smartphone" sales this year at 300-310 million, and plans to sell around 360 million in 2014, of which about 126 million will be "premium models."
That report described Samsung's flagship Galaxy S4 as having "sluggish sales this year," and referenced the firm's "the low-end model-driven business strategy." The company originally projected that the Galaxy S4 would sell 100 million units a year on its own, before sales collapsed this spring shortly after its launch.
Samsung's current sales and future plans consistently describe that only around one third of Samsung's "smartphones" are actually comparable to Apple's current iPhones, albeit being a generation behind.
Samsung's U.S. Galaxy S4 handles benchmarks slightly slower than Apple's iPhone 5c (which is very similar to the iPhone 5 Apple released last year), while all of Samsung's smartphones still lack the 64-bit power and extended battery efficiency of Apple's A7-powered iPhone 5s flagship.
Over the last fiscal year, Apple reported sales of 150 million iPhones. Unlike Samsung, Apple is not reporting an end to high end sales growth. Instead, Apple's high end is growing faster (26 percent) than than the overall phone industry (7 percent), according to CNET.
That's a serious problem for Samsung, which makes about two thirds of its total profits from smartphone sales. Apple also relies very heavily upon iPhone sales, but it also has profitable Mac, iPad and iTunes, software and service related businesses, which generate ten times the profit of Samsung's struggling Chromebook netbook, Android tablet and Windows PC sales.
Comments
If I was a shareholder of this company and went to an investors' meeting and they said the strategy was to "make more acquisitions" I would be mortified.
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[All data came from IDC Q3 2013]
So we can estimate sales on Q3 2013 : iPhone high-end smartphone sales (iPhone 5 ) are 16,22 millions to be compare with Samsung high-end smartphone sales at 27,1 millions.....
OK, if that's what floats your boat.
You are failing to comprehend that "high end" here basically means iPhone 4 or better.
Most of Samsung's "smartphones" are $100-$300 basic phones barely running Android and not capable of using apps or getting upgrades.
We aren't splitting hairs between "very latest model" and "year or two old"
Most of Strategy Analytics' smartphone numbers are counting low end junk, just like the tablet numbers that are mostly no name things that sell for $40-$90
Android fans imagine that the mass market is Nexus/Galaxy/HTC One stuff comparable to iPhone. Only a very small fraction is.
Samsung sells way more than half of the premium android phones in the US, and there aren't many sold in most "emerging markets"
Do you think Samsung only makes 60% of android profits? If so, go read more. Samsung sells the most premium android phones by far.
That's why everyone else is losing money and not proud enough of their sales numbers to even report them.
TOO LOSE IN PERFORMANCE ACROSS THE BOARD.
When Apple jumps up in RAM [if reports are correct] to triple that of their current levels, with an Quad Core A8 [or later], while still being finicky on wasting energy perhaps then people will figure out that the talent amassed at Apple is top of the stack.
Most of Samsung's "smartphones" are $100-$300 basic phones barely running Android and not capable of using apps or getting upgrades.
We aren't splitting hairs between "very latest model" and "year or two old"[/quote]
Do you really think two years old smartphone iPhone (4/4S) is still high-end ? Samsung high-ends smartphones price-tag (Galaxy S4 / Note 3) are comparable with Apple iPhone's price-tag 600$ .
I'm not splitting the hairs, I'm just analyzing the market and phone performance's correctly without passion. Apple Insider just gave you the facts to say "Samsung outsells Apple even on premium segment..."
Apple has a strategy to keep selling old-phone like 4S in order to attract budget-conscious buyers. It's a good strategy ! And beeing second in premium market is still a good position.... no matter what.
Hopefully, Apple Q4 sales should allow Apple to be soon again number one in premium market segment, at least for a quarter
Acquiring companies is not in itself a strategy, is it? You first come up with a strategy, and then you acquire companies (or don't, as needed) to achieve it. Acquisitions are a tactic.
If I was a shareholder of this company and went to an investors' meeting and they said the strategy was to "make more acquisitions" I would be mortified.
Do you consider Apple's acquisition of Intrinsity & PA-semi as a business strategy or tactic?
You are failing to comprehend that "high end" here basically means iPhone 4 or better.
Most of Samsung's "smartphones" are $100-$300 basic phones barely running Android and not capable of using apps or getting upgrades.
We aren't splitting hairs between "very latest model" and "year or two old"
Most of Strategy Analytics' smartphone numbers are counting low end junk, just like the tablet numbers that are mostly no name things that sell for $40-$90
Android fans imagine that the mass market is Nexus/Galaxy/HTC One stuff comparable to iPhone. Only a very small fraction is.
Samsung sells way more than half of the premium android phones in the US, and there aren't many sold in most "emerging markets"
Sure, do you have any data to back up your claims? Considering Samsung doesn't publish their sales/shipment unit, like Dilger, you seem to be pulling numbers out of your a**.
Do you really think two years old smartphone iPhone (4/4S) is still high-end ? Samsung high-ends smartphones price-tag (Galaxy S4 / Note 3) are comparable with Apple iPhone's price-tag 600$ .
I'm not splitting the hairs, I'm just analyzing the market and phone performance's correctly without passion. Apple Insider just gave you the facts to say "Samsung outsells Apple even on premium segment..."
Apple has a strategy to keep selling old-phone like 4S in order to attract budget-conscious buyers. It's a good strategy ! And beeing second in premium market is still a good position.... no matter what.
Hopefully, Apple Q4 sales should allow Apple to be soon again number one in premium market segment, at least for a quarter
If the definition of a smartphone is to be able to run apps well, yes the 4s is still high end smartphone. Heck, even the lowly old 3GS I kept (i use a lot more the ipad mini now, keep the phone for calls and maps mostly) run better than some of the lowend samsungs I see around.
The galaxy S line is not so bad ( but i really dislike the screen both for colors and lack of responsiveness, and the flimsy plastic shell) but the low end of the bucket is really junk, to the point that a nokia dumbphone is actually better value.
Read the article
Read the article
I've always updated at the end of my 2 year contract, but my Iphone 4s is still performing very well, its all relative....Compares to the S4 or 5s, no it's not high end, compared to everything else then yes it is.
2 years old or not it's still a very powerful phone, and to write off the 4s or any other (apple, galaxy or HTC) phone because they are not as powerful as the very latest is foolish.
there are samsung phones actually comparable to iPhone??
did I miss something?