Apple & Samsung combine for 106% of handset profits as competitors continue to bleed cash
Apple remained by far the most profitable mobile phone maker in the just-concluded March quarter with 65 percent of value, while all other competitors except Samsung either lost money or broke even, the latest research shows.
While Apple took the lion's share of industry profits in the first quarter of calendar 2014, according to the latest estimates from Canaccord Genuity, Samsung was in second with a 41 percent share.
Beyond that, every single other company either had a negative value share, or they were neutral.
The biggest loser in the quarter was Nokia, which was estimated to have had a net impact of -3 percent on industry profits. Also losing money were BlackBerry and Motorola, both of which accounted for -1 percent.
Breaking essentially even, and thus having a 0 percent share of industry profits, were Sony, LG and HTC.
Losses by Nokia, BlackBerry and Motorola, and neutral showings for the other biggest players, mean that Apple and Samsung together account for more than 100 percent of industry profits estimated by analyst Michael Wakley. Apple achieved this with mobile device operating margins estimated at 37 percent, while Samsung saw operating margins of 22 percent.
Apple's estimated share is up from the same period a year ago, when the company was pegged to represent 57 percent of industry profits. Samsung, meanwhile, was down from 43 percent in the year-ago quarter.
Apple and Samsung have been combining for more than 100 percent of industry profits for numerous consecutive quarters, a feat possible only because their competitors continue to bleed cash and struggle to contend with market leading devices like the iPhone or Galaxy S lineups.
Walkley noted on Thursday noted that Chinese smartphone manufacturers are growing in their home country, but his analysis excludes this group due to the lack of available profit metrics from those companies.
"Given the current competitive dynamics, we believe Apple and Samsung will maintain dominant value share during 2014," Walkley said. "With BlackBerry struggling and Microsoft purchasing dominant Windows Phone OEM Nokia, we believe Chinese OEMs with strong Android portfolios will likely emerge as stronger long-term competitors to Apple and Samsung."
While Apple took the lion's share of industry profits in the first quarter of calendar 2014, according to the latest estimates from Canaccord Genuity, Samsung was in second with a 41 percent share.
Beyond that, every single other company either had a negative value share, or they were neutral.
The biggest loser in the quarter was Nokia, which was estimated to have had a net impact of -3 percent on industry profits. Also losing money were BlackBerry and Motorola, both of which accounted for -1 percent.
Breaking essentially even, and thus having a 0 percent share of industry profits, were Sony, LG and HTC.
Losses by Nokia, BlackBerry and Motorola, and neutral showings for the other biggest players, mean that Apple and Samsung together account for more than 100 percent of industry profits estimated by analyst Michael Wakley. Apple achieved this with mobile device operating margins estimated at 37 percent, while Samsung saw operating margins of 22 percent.
Apple's estimated share is up from the same period a year ago, when the company was pegged to represent 57 percent of industry profits. Samsung, meanwhile, was down from 43 percent in the year-ago quarter.
Apple and Samsung have been combining for more than 100 percent of industry profits for numerous consecutive quarters, a feat possible only because their competitors continue to bleed cash and struggle to contend with market leading devices like the iPhone or Galaxy S lineups.
Walkley noted on Thursday noted that Chinese smartphone manufacturers are growing in their home country, but his analysis excludes this group due to the lack of available profit metrics from those companies.
"Given the current competitive dynamics, we believe Apple and Samsung will maintain dominant value share during 2014," Walkley said. "With BlackBerry struggling and Microsoft purchasing dominant Windows Phone OEM Nokia, we believe Chinese OEMs with strong Android portfolios will likely emerge as stronger long-term competitors to Apple and Samsung."
Comments
I hate to say this, when are they going to put knife in Motorola, it has been loosing money since 2005, I mean the cell phone piece the only reason they showed a profit was due to all their other business. Really 9 years and not a single quarter of profits. I highly doubt Lenovo will turn it around. What you will see is them stick the Motorola name of the cheap ass phone they make so they can sell in the US market.
rolleyes
I'm going to get dinged but Apple should seriously consider Wozniaks suggestion and have Apple offer Android cell phones. If Apple buys, HTC...they get contracts, licenses, etc. as well. HTC is considered by the Industry the best Android phone worldwide. Image it would shake the very foundation of Samsungs plastic phone.
Yeah! Great idea. They should license iOS Samsung too.
Because they gave 110% effort, right?
rolleyes
106% of profits indicates loss by the others because they went into the negative.
CORRECTION:
Apple & CLONE combine for 106% of handset profits as competitors continue to bleed cash...
No offense, but that's the dumbest idea ever. Apple sells iOS devices. They make money selling iPhones. HTC isn't making money on Android.
----
So 106% is the new 103%.
What a dumb headline. Losses aren't profits. You can't grab more than 100% of something. Apple and Samsung combined grabbed 100% of the profits.
Everybody knows that but if AI writes something that preposterous in the headline, they know thousands of people will click on it.
What a ridiculous headline for the report. The only purpose for saying something like "Coke and Pepsi earn the most money together!" is to obfuscate whether Coke or Pepsi is leading, and distract away from every other loser.
Apple's "% share" of Q1 phone profits is up YoY, from 57 to 65%; earnings went from $8 to $9.6 billion.
Samsung's "% share" of Q1 phone profits down YoY, from 43 to 41%. It earned an unchanged $6 billion.
"Breaking essentially even, and thus having a 0 percent share of industry profits, were Sony, LG and HTC."
Nokia, LG, Sony, HTC, Motorola & BlackBerry all lost money in Q1, with only LG & Sony reporting even a minor profit across all of 2013.
Sony losing $3 million, LG losing $8 million and HTC losing $68 million in THREE MONTHS is not really "breaking even."
I'm going to get dinged but Apple should seriously consider Wozniaks suggestion and have Apple offer Android cell phones. If Apple buys, HTC...they get contracts, licenses, etc. as well. HTC is considered by the Industry the best Android phone worldwide. Image it would shake the very foundation of Samsungs plastic phone.
Apple already gets royalties from HTC. Taking over an operation that loses millions of dollars per quarter is not really Apple's bag.
There is virtually ZERO demand for Android phones. There are lots of people who can only choose between various phones that are $300 or less, and those devices now often run Android rather than Java, but Nokia Asha (now run by Microsoft!) and Blackberry also sell low end phones, along with embedded phones sold by LG, etc. Not a market to be in.
The media has invented the idea that "Android" is a market rather than an ingredient that has primarily found a market among low end devices.
Apple's the only one ready to fight Samsung and their marketing/sales/product (BS) tactics... which in the end levels the playing field more for the OEMs than it does anything for Apple.
Heck... all Apple gets out of it is the Principles and Morality high road, while catching all of the Troll-Boy flak on their low road trip to "Good Enough City" camouflaged as good for consumers.
Everybody knows that but if AI writes something that preposterous in the headline, they know thousands of people will click on it.
There needs to be a term to combine profits and losses. The 106% is correct via (Apple + Samsung profits)/ (Apple + Samsung profits - everybody else's loss)
To not include the loss part would be disingenuous
Apple & CLONE combine for 106% of handset profits as competitors continue to bleed cash...
Apple hardware and software design responsible for 106% of handset profits; all other content loses money
To not include the loss part would be disingenuous
No, it would actually make sense.
There needs to be a term to combine profits and losses. The 106% is correct via (Apple + Samsung profits)/ (Apple + Samsung profits - everybody else's loss)
To not include the loss part would be disingenuous
Link to clarify .... (or as DED would say - 'This has happened before')
http://forums.appleinsider.com/t/160733/apple-samsung-take-massive-109-of-mobile-industry-profits-while-competitors-lose-money
Link to clarify .... (or as DED would say - 'This has happened before')
http://forums.appleinsider.com/t/160733/apple-samsung-take-massive-109-of-mobile-industry-profits-while-competitors-lose-money
Oh I know it's happened before I was more arguing for a different word rather than "profit" to hopefully avoid these conversations
It is called profit AND loss for a reason. Growing them together to form a pross is bad math on many levels.
Yes, and likewise, Mercedes should buy Fiat and make low cost low value cars. Volume is everything. Really?
Mercedes does offer low cost cars. You've heard of the A-Class and B-Class right?