Editorial: Sorry Android bloggers, but Samsung's Galaxy S7 didn't outsell Apple's iPhone 6s

Posted:
in iPhone
Android fan blogs, led by The Verge, shouted to their audiences this week that Samsung's flagship Galaxy S7 managed to surpass sales of Apple's iPhone 6s, based on a Kantar survey of U.S. buyers. The story illuminates some interesting contradictions and exposes other misleading narratives about the smartphone market.




Samsung, the underdog who's always on top



Some facts are not controversial. Samsung consistently ships greater numbers of phones than Apple. However, the reason why Apple is so much more profitable and influential than Samsung relates to the quality of the phones Apple sells, not the total unit numbers.

That's reflected in Apple's Average Selling Prices for iPhones, which have hovered above $650 as Android phones flirt with $200. While many Chinese phone makers almost exclusively make cheap phones (and therefore earn very little, if anything), Samsung offers flagship models that cost as much or more than iPhones. The problem is that Samsung can't manage to sell these premium phones in iPhone-like quantities.



Back in 2014, Samsung reached a peak number of flagship Galaxy S4 sales that coincided with record profits from its phone making IM division. However, when Apple launched iPhone 6 it eviscerated Samsung's high end sales. While the company's total phone shipments remained about the same, its premium models saw unit sales declines of around 50 percent, resulting in a devastating blow to its profitability.

In Q3 2014 Samsung's Galaxy S products + Note products saw nearly 50% decline in sales both QoQ and YoY according to my mix estimates.

— Ben Bajarin (@BenBajarin)


This year, Samsung's premium Galaxy S7 sales have indeed performed better, relative to the last two years of slump. However, the company's performance is nowhere near Apple's and only in line with the Galaxy S4--a phone that was outsold by iPhone 5.

3 days of iPhone 6s outsold 3 weeks of Galaxy S7



Samsung has historically launched its Galaxy S flagship in April, missing out on both the Western holiday quarter and China's Lunar New Year; both are peak quarters for Apple's highly cyclical iPhone sales. This isn't on accident or because the company is stupid; Samsung knows it can't directly compete against an Apple launch so it purposely avoids doing so.

This year, Samsung launched its Galaxy S7 earlier than usual on March 11. This enabled Samsung to get a month-long jump on two flagship launches of its rivals: LG and HTC. Samsung didn't report official sales numbers, but is estimated to have shipped around 10 million S7 and S7 Edge models in the remaining three weeks of the March quarter, out of the 82 million smartphones IDC estimates that Samsung shipped in total.

By way of comparison, at the weekend launch of iPhone 6s last Sept 25, Apple announced sales of over 13 million units across 3 days. In total, Apple sold 75 million iPhones in the launch quarter, the most it has ever sold.

None of these were "carrier friendly, good enough" models. They were all premium priced iPhones with an ASP of $650. During that same winter quarter, Samsung still shipped millions more total phones than Apple, but it earned much less. In the March quarter, Samsung IM earned $3.38 billion vs Apple's $13.987 billion.

Also notable is the fact that Samsung similarly scrambled to launch its larger flagship, the Galaxy Note 5, earlier than usual, too. Previously launched in October, it was instead moved up to August last year in an effort to get a jump on Apple's iPhone 6s Plus. That doesn't seem to have mattered, because Apple still exceeded its previous peak in launch weekend and total quarterly sales.

Apple has a problem but it's not Samsung



Despite achieving a record fiscal Q1 over the winter, Apple's earnings and guidance for Q2 raised concerns of slowing growth. Apple blamed a global economic downturn, and in particular noted the affect of unfavorable currency exchange rates. A strong U.S. dollar was effectively raising Apple's prices for almost everyone outside the U.S., and particularly in China. Incidentally, that's a problem Samsung doesn't face because it reports earnings in Korean Won.

However, rather than accepting Apple's figures, a variety of analysts and bloggers invented a New Realty where there's no longer any growth potential for premium smartphones, particularly in mature markets like the U.S., where many were repeating verbatim that "everyone who wants an iPhone already has an iPhone."

After a solid three months of preaching the gospel of Peak Phone, many of these same people have done a 180 and are now claiming that Samsung is showing Apple how to sell growing numbers of premium phones.

They're pointing to a global year-over-year quarterly decline in iPhone sales by Apple compared to an increase in Galaxy S7 sales by Samsung--a launch quarter with an estimated 25 percent growth over the S6 (according to data from Counterpoint Research.)

However, context is relevant. Last year, Apple sold 61.2 million iPhones in Q2; this year sales reached "only" 51.2 million. Samsung's premium Galaxy S7--despite a big 25 percent year-over-year jump--still only reached 10 million. Counterpoint attributed Samsung's Galaxy S7 "growth" to the previous failure of the S6

Counterpoint attributed Samsung's Galaxy S7 "growth" to the previous failure of the S6. The firm noted that "Samsung lost the window of opportunity" last year in being unable to satisfy customer demand due to supply constraints in the models customers wanted.

Samsung's "growth" came, not from being more exciting than iPhones, but in being less incompetent in this year's Galaxy S launch. It also came from increased promotional bundling deals that Counterpoint noted "included VR headsets, buy-one-get-one deals, tablets and even televisions."

And rather than being real growth, Counterpoint's research director Neil Shah estimated that the Galaxy S7 was only "on par with the popular S4 model," which launched three years ago.

Apple's sales were down from its year-ago iPhone 6 sales peak, but up dramatically from 2014's iPhone 5. Samsung's flagship has been down for years, and has only returned to the frozen performance of its own iPhone 5 rival. When you compare percentages of growth in different numbers, you arrive at often meaningless statistics that can be very misleading.


Reports of Samsung's "growth" don't hold water either


Further, while Samsung reversed the downward trend in its flagship, its total sales of smartphones were actually slightly down. IDC observed in April that "Samsung remained the leader in the worldwide smartphone market despite a year-over-year decline of 0.6% in shipments."

So while Apple was immediately assumed to be permanently unable to grow after one quarter of failing to exceed its year ago peak sales related to iPhone 6, Samsung was given two years to return to its former peak from 2014, and celebrated for "growing" all that time, despite still having made no real progress from that former peak.

"Apple versus Samsung is so over"



This week, Lauren Guenveur of Kantar noted in the firms' Worldpanel report that, "anyone still focusing on these two giant competitors, however, is missing the bigger picture."

Erasing the idea that iPhone buyers were flocking to Samsung, Guenveur noted that in the U.S., "the majority of sales came from customers repurchasing and upgrading within their preferred brand. Among those intending to change devices within the next year, 88% of current Apple users and 86% of current Samsung users intend to stay loyal."

Among defectors, however, the rate of buyers switching to Apple was 2.8 times higher: "just 5% of Samsung purchases came from those switching away from Apple, while 14% of Apple purchasers came from those switching away from Samsung." "Just 5% of Samsung purchases came from those switching away from Apple, while 14% of Apple purchasers came from those switching away from Samsung"

Kantar Worldpanel data is not based on sales channel data. It's compiled from a surveys of participants. That makes it useful for noting broad trends.

But based on that report, Vlad Savov wrote for The Verge that "Samsung's Galaxy S7 is outselling Apple's iPhone 6S in the US," although noting that "granted, it's not a fair fight, owing to Samsung's S7 and S7 Edge being the newer handsets by half a year."

It's also "not really fair" to ignore 13 million iPhone 6s sold in its first three days, plus another 113 million iPhones sold across two quarters, and then look at a fraction of Samsung's sales (exuberant estimates say the company sold maybe 25 million premium phones across two quarters of 2016) and portray survey results as definitive in making sales comparisons.

Apple and Samsung globally



The Verge report also ignored the rest of Kantar's data. That includes figures for China, "the world's largest smartphone market," which showed that Samsung has seen its once-leading share in urban markets collapse from 34 percent back in 2014 to 9 percent two years later. Samsung's top spot in that market is now occupied by Apple and Huawei.

Further, while Savov called Samsung's relatively high brand loyalty in the U.S. a "monumental achievement," he ignored the situation in China, where Kantar's said brand loyalty "remained low."

Among Huawei's buyers, Kantar reported that 24 percent switched from Samsung phones, and among iPhone buyers, 25 percent switched from Samsung, an even higher rate than in the U.S.




That aligns with data presented by Apple's chief executive Tim Cook, who has noted record numbers of Android switchers buying iPhones.

Samsung should be applauded for fixing its Galaxy S supply problems this year. But it doesn't need fake headlines pretending that it's performing better than Apple, especially given that in reality it hasn't grown its premium sales at all over the last two years, is making no real progress in significantly expanding its flat sales of smartphones in general, and has lost its leadership position in China entirely.
trollkillerration aljahbladestevehMacsAlwaysbrakken
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Comments

  • Reply 1 of 56
    It's nice and reassuring that there is real reporting out there that reports on the real facts and not some conjured up articles just to make headlines on this website or any other out there including blogs. It's amazing to me that even though the 6s sales didn't match the 6 sales, they still out preformed Samsung and other phone makes by leaps and bounds. I'm not a Samsung hater out there. I love my apple products and their innovation ( even though people will say that Apple is getting lazy in that department as of late ), I just don't like rival smartphone makers practically coping Apple in design and color and now with tech with their version of their pay program and they say that's it's the next big thing. Apple was the first to mention a Apple Watch, Apple Pay, they were the first with a lightning port adapter, iPad, so on and so on and then they say ours is better, get busted by coping them, lost almost every court battle and they still have the audacity to say the next big thing is here and we are outselling Apple. They have lost trust in consumers by coping, then lying and then get caught lying and have to pay out big because again they lost just about every court battle, when really it wasn't a battle at all. That's why you go to a Verizon, AT&T, sprint, t-mobile and they sell you their premium Samsung phone and it's a buy 1 get 1 program. Or you buy their newest flagship phone and then they give you their old version of an iPad that's a few years old and it's the tablet that was in the infringement case and Samsung wants them gone or they will have to buy them back. And they don't want to do that because they are already paying out the A$$ in fines and court costs.
    WOW me Samsung, don't copy and say yours is better ( when in reality it's not ) and dont feed websites and bloggers and tell them you are profitable and outselling Apple when again reality your not. If you can do that then you might have my attention.
    magman1979baconstangindyfxrepressthisjbdragonjahbladeMacsAlwaysbrakkenP-DogNCbig
  • Reply 2 of 56
    jaaycojaayco Posts: 46member
    iushnt said:
    Sorry AI but I find your blog the most misleading and biased compared to anyone else.
    Yeh I agree. What's with all their use of real numbers and coherent arguments!

    /s
    caliDeelronanantksundarambaconstangjfc1138ration alredgeminipanetmageindyfxjustadcomics
  • Reply 3 of 56
    calicali Posts: 3,495member
    icrap said:
    Somebody is mad and wrote this biased article.  The truth hurts. S7 outsold  iphone 6 family. The SE is a joke to answer the great S7 family. Iphone sales are lower because people have realized apple is not innovating.  Samsung is doing fresh new stuff curve Edge displays, brought back water proof, SD card and popular VR. Samsung has bundle specials with buy 1 get 1 free phone, free watch. Free vr, free tv..... ect  how come apple don't do this? Apple is greedy that over prices all its products like $ 100 for a stylus for the iPad pro. Come on really $100 bucks. I work at a warehouse with over 500 employees and I'm starting too see a trend. More people have galaxy phones then iPhones. The truth hurts Apple fan boys ✌✌✌✌✌
    Apple not innovating.

    defends the knockoffs.

    SMH

    Even with free TVs Sammy is struggling to keep up
    wity their idol.

    Let's hope android figures out how to copy 3D Touch by 2017.
    edited July 2016 ericthehalfbeeration alredgeminipanetmagejbdragonjony0stevehbrakkenP-DogNCTurboPGT
  • Reply 4 of 56
    calicali Posts: 3,495member
    icrap said:
    ljm828312 said:
    It's nice and reassuring that there is real reporting out there that reports on the real facts and not some conjured up articles just to make headlines on this website or any other out there including blogs. It's amazing to me that even though the 6s sales didn't match the 6 sales, they still out preformed Samsung and other phone makes by leaps and bounds. I'm not a Samsung hater out there. I love my apple products and their innovation ( even though people will say that Apple is getting lazy in that department as of late ), I just don't like rival smartphone makers practically coping Apple in design and color and now with tech with their version of their pay program and they say that's it's the next big thing. Apple was the first to mention a Apple Watch, Apple Pay, they were the first with a lightning port adapter, iPad, so on and so on and then they say ours is better, get busted by coping them, lost almost every court battle and they still have the audacity to say the next big thing is here and we are outselling Apple. They have lost trust in consumers by coping, then lying and then get caught lying and have to pay out big because again they lost just about every court battle, when really it wasn't a battle at all. That's why you go to a Verizon, AT&T, sprint, t-mobile and they sell you their premium Samsung phone and it's a buy 1 get 1 program. Or you buy their newest flagship phone and then they give you their old version of an iPad that's a few years old and it's the tablet that was in the infringement case and Samsung wants them gone or they will have to buy them back. And they don't want to do that because they are already paying out the A$$ in fines and court costs.
    WOW me Samsung, don't copy and say yours is better ( when in reality it's not ) and dont feed websites and bloggers and tell them you are profitable and outselling Apple when again reality your not. If you can do that then you might have my attention.
    Apple first released the smart watch? Are you you serious? Samsung 1st released a smart watch in 1999
     Android wear is being out since 4 years ago. Apple watch barely came out in 2015. Samsung created the phablet industry with the 1st Note in 2011. 6 plus came out until 2014. So apple copied Samsung note phablet phone. IPad pro is a wanna be Microsoft  Surface pro.  Microsoft had window tablets since 2002. So apple didn't invent the iPad tablet. Apple copied HTC one 7 metal design for iPhone 6. About  the apple lawsuit vs samsung is ridiculous. The Supreme Court needs to fix the fractured US Patents. Apple sued samsung for phones looking like iPhones with rectangular shape. Come on that's a joke. Get your facts right before you write.  Apple is a copy cat too

    Who opened the door for all the morons?

    this guy reminds me of the idiots that think iPhone was conceived, developed and released in 2007 in a matter of days.

    Claiming screen size is innovation. SMH. A bigger iPhone isn't innovation.
    That's like saying a bigger TV is "innovative." If only iterate that easy.
    I almost feel sorry for these guys.
    ericthehalfbeemwhitebaconstanglostkiwibadmonkxmhillxration alindyfxnolamacguyrepressthis
  • Reply 5 of 56
    It's amusing in a typical DED word salad article he doesn't actually refute the kantar data but makes a wholly different argument about launch week and total sales. Buddy, who are you arguing with?




    cnocbuisingularity
  • Reply 6 of 56
    Hey trolls, you need some better material (and some original usernames that don't sound like a child picked). I enjoy owning you as much as the next person, but lately dealing with you all is like playing checkers with a 5 year old. Sure you win every time, but there's no satisfaction.

    So please step up your game. This is getting boring.
    edited July 2016 anantksundaramroundaboutnownolamacguybaconstanglostkiwitrollkillerration alredgeminipaindyfxjustadcomics
  • Reply 7 of 56
    Yes, it is pretty funny that the report in question is not actually challenged. Kantar reports quarterly data, and for the first time the Samsung flagship outsold the Apple flagship in the US. By a tiny amount. It is significant because it hasn't happened before but perhaps that is also the real surprise given that the quarter in question is much more favorable to Samsung. I have an S7 edge and it is no surprise to me ... I imagine the phone is getting very strong word of mouth because it is the clearly the best phone ever released. Unlike the S5 and S6 there is no compromise this time. There can be discussion around the software but the hardware superiority is an open and shut case.
  • Reply 8 of 56
    why-why- Posts: 305member
    the things people choose to waste their energy on will never cease to amaze me
    crshnrepressthis
  • Reply 9 of 56
    rogifan_newrogifan_new Posts: 4,097member
    Another TL;DR rambling article. So a new phone from Samsung beat out a 9 month old phone from Apple for one quarter, and just barely at that. Big deal. I would say these overly defensive articles scream "The lady doth protest too much, methinks".
    elijahgDan Andersensingularity
  • Reply 10 of 56
    rogifan_newrogifan_new Posts: 4,097member
    Hey trolls, you need some better material (and some original usernames that don't sound like a child picked). I enjoy owning you as much as the next person, but lately dealing with you all is like playing checkers with a 5 year old. Sure you win every time, but there's no satisfaction.

    So please step up your game. This is getting boring.
    Honestly it's DED who needs to step up. He can do better.
    lord amhranelijahgsingularity
  • Reply 11 of 56
    appexappex Posts: 687member
    "Samsung's Galaxy S7 didn't outsell Apple's iPhone 6s". What about worldwide sales?
  • Reply 12 of 56
    Icrap is a lil angry with me!
    Thats funny. 
    I read quite a few articles on the web ( including Sammys own website ) and there is no mention of a watch being made in 1999. Now maybe a regular watch but no smart watch. They didn't develop one and started shipping them until 2013/14, after the fact and keynote of apples unveil. They just rushed their product out before Apple did and claimed 1st. Apple made news with iPhone 2007, iPad 2010, iCloud 2009, Apple Watch 2014 etc..etc..
    The point I was trying to make is yes Samsung copies Apple, and I guess Apple copies Samsung as far as screen size goes, because everyone whined and wanted a bigger screen size so Yes Apple caved and gave them a bigger screen size, well then just a few years later people again whined that they missed the 4" screen size so Apple yet again caved and gave them a smaller screen size. And now everyone wants a waterproof iPhone. Samsung already has a somewhat water resistant phone but not water resistant enough according to consumer reports. And now Apple must have one. So to sum this up.. Samsung copies Apple, and Apple copies Samsung. Again this goes back to innovation bigger screen sizes isn't innovation as stated in the blog above ( please forgive me I forgot who typed the rebuttal blog above ). It's how you innovate. How's is their music, cloud, pay doing? 
    icoco3singularity
  • Reply 13 of 56
    Hey trolls, you need some better material (and some original usernames that don't sound like a child picked). I enjoy owning you as much as the next person, but lately dealing with you all is like playing checkers with a 5 year old. Sure you win every time, but there's no satisfaction.

    So please step up your game. This is getting boring.
    Honestly it's DED who needs to step up. He can do better.

    Considering how upset people get with his articles, and how many trolls sign up just to complain, I'd say he's at the top of his game.
    baconstangjfc1138lostkiwicapasicumtrollkillerbadmonkration alnetmagenolamacguyicoco3
  • Reply 14 of 56
    Regardless of sales. The s7 is the best  smartbest phone. I use both operating systems. Both are great but the iPhone is dated hardware. Maybe it opens a couple of apps a second faster but that's it really. Android phones have it beat. They have better screens,cameras,storage,battery life,charging, etc etc. 
    cnocbui
  • Reply 15 of 56
    spudwood said:
    Regardless of sales. The s7 is the best  smartbest phone. I use both operating systems. Both are great but the iPhone is dated hardware. Maybe it opens a couple of apps a second faster but that's it really. Android phones have it beat. They have better screens,cameras,storage,battery life,charging, etc etc. 
    Perhaps SOME Android devices have the iPhone beat. But the rest? Rubbish in the main. Did you know that some retailers are still selling Androd devices with Gingerbread and no prospect of any upgrades.
    In this day an age, this should just not be happening.
    Everyone use case is different. For me, android is a security nightmare. That is enough to make me not even want to consider buying any android phone for anything other than making phone calls.

    xmhillxration alnetmagejustadcomicsrepressthisjbdragonelijahg
  • Reply 16 of 56
    Does it really matter all that much if a newly launched product outsells an older product. There are so many people gunning for Apple hoping the company will go out of business. It's really weird. It's like people hoping Toyota will put Mercedes-Benz out of business. It doesn't make much sense at all. Neither is going to happen. A company can almost make certain one product can outsell another by price reductions and 2-fers, if necessary. What is the big deal? It's like people are always trying to find every little chink in Apple's armor and they think it's worth shouting from the rooftops. Product sales can slow every so often when another companies' products are introduced. It's hardly a death knell for any company loaded with cash.
    nolamacguyrepressthisjbdragon
  • Reply 17 of 56
    512ke512ke Posts: 782member
    Apple's profits declined. Samsung's profits increased. But these facts are not causally connected, and that's not click-worthy news. The bloggers need blood. Conflict. Drama! Samsung kills Apple! Samsung steals share from Apple! And the markets need that drama to convince individual investors to panic. Money gets made that way. Stock prices are manipulated. Bloggers get their clicks. All that comes from emotion. Emotion makes money. 

    But this article is all about rationality and facts. Those who search for facts can make money as well!

    The way: Buy APPL and hold. And don't read financial blogs lol. 
    edited July 2016 ration alnetmagerepressthisai46
  • Reply 18 of 56
    512ke said:
    Apple's profits declined. Samsung's profits increased. But these facts are not causally connected, and that's not click-worthy news. The bloggers need blood. Conflict. Drama! Samsung kills Apple! Samsung steals share from Apple! And the markets need that drama to convince individual investors to panic. Money gets made that way. Stock prices are manipulated. Bloggers get their clicks. All that comes from emotion. Emotion makes money. 

    But this article is all about rationality and facts. Those who search for facts can make money as well!

    The way: Buy APPL and hold. And don't read financial blogs lol. 
    And, when competition is strong consumers profit. Apple also needs strong competition to keep greedy and on top of the game. I really hope Samsung and others bring in great products for us all. 
    ration alrepressthis
  • Reply 19 of 56
    croprcropr Posts: 944member
    512ke said:
    Apple's profits declined. Samsung's profits increased. But these facts are not causally connected, and that's not click-worthy news. The bloggers need blood. Conflict. Drama! Samsung kills Apple! Samsung steals share from Apple! And the markets need that drama to convince individual investors to panic. Money gets made that way. Stock prices are manipulated. Bloggers get their clicks. All that comes from emotion. Emotion makes money. 

    But this article is all about rationality and facts. Those who search for facts can make money as well!

    The way: Buy APPL and hold. And don't read financial blogs lol. 
    I agree with your first paragraph, but not with the second.  DED is denying the facts of the Kantar, he prefers to distribute a lot of fog around it, so people n longer see the facts. 

    According to Kantar the Android market share in Q1 2016 grew with 7% to 78% in the top 5 countries in Europe.  2.6% of that 7% were people who were switching from iOS.  Taking that the market share of iOS was around 20% in these countries, this means that in Europe there is a net transfer from 1 out of 8 iPhone users to Android in a year time.  From an Apple perspective this is terrible.

    It does not mean that Apple is doomed, it just means that Apple cannot sit and wait, Apple needs to constantly beat the market in with better products.

    By focusing on the iPhone vs Samsung S7, DED ignores a very important trend.  The smartphone in the $200 - $350 price range has improved much faster than the top models, closing the gap.  A lot of people who bought in the past a top model (Apple and Samsung) are now buying this midrange models (Moto G+, Samsung A3, Huawei P9 lite, Nexus 5X,...), who offer a much better price/performance ratio than the top models.
    cnocbuirepressthisRayz2016singularity
  • Reply 20 of 56
    cnocbuicnocbui Posts: 3,613member
    DED doesn't need to workout in a gym if he keeps up with such desperate bailing efforts.  The quality of his 'sources' for 'supporting' evidence are dire - twitter? - and as for his logic?  The S7 went on sale in March, so DED quotes an IDC report from APRIL alleging an annual 0.6% decline in overall sales for the preceding year.  So in support of an article alleging the S7 didn't outsell the 6S, he uses as 'evidence' a report that clearly didn't include a single S7 sale.  Brilliant!

    In criticising The Verge for it's story about S7 sales in 2016, he says: "
    The Verge report also ignored the rest of Kantar's data. That includes figures for China, "the world's largest smartphone market," which showed that Samsung has seen its once-leading share in urban markets collapse from 34 percent back in 2014

    Exactly how are supposed Samsung sales in 2014 relevant to an argument about S7 sales in the US in 2016?

    The content of the article doesn't even get close to supporting it's title.  It smacks of war time propaganda.  DED is Apple's Lord Haw Haw.

    edited July 2016 Dracarysrepressthislord amhranstaticx57
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