Apple Makes 93% of Profits in the Smartphone Market

As a result of making $18 billion in total earnings during the holiday quarter, Apple has captured 93% of the profits in the smartphone industry, according to the investment company Canaccord Genuity. Samsung took most of the remainder although its share is declining. All the other smartphone makers got very little, if any, including LG, Google, Sony, Microsoft and others.

We think the same may also be true in tablets where iPads have high gross margins.

 

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iPhones: on course for half-a-billion customers

 

Canaccord Genuity estimated that in the year ago Q4 2013 Apple’s share was 87.4% and Samsung’s was 32.2%. The reason the two totals are more than 100% is because other smartphone makers lost money.

Canaccord Genuity did not include Xiaomi in its calculations because a) Xiaomi does not publish its financial results and b) Xiaomi makes little if any from its smartphones. Most of its profits are thought to come from the aftermarket of apps, games, and Android operating system themes and Internet services.

Samsung sells more smartphones than Apple but is losing ground in the high-end market to Apple and in the low-end to Chinese companies such as Xiaomi.

Mike Walkley, the Canaccord Genuity analyst who wrote the report, estimated that Apple will have nearly half a billion iPhone customers by the end of 2015. If Apple continues to …

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