Philip Elmer-DeWitt reports for Apple 3.0, “From a note to investors by Canaccord Genuity analyst T. Michael Walkley deposited into my inbox late Monday: ‘Based on analysis detailed in this report, Apple captured strong share of the premium-tier global smartphone market during Q1/C2017 generating 83% of industry profits, down from 88% in Q4 due to Samsung’s improved results and other OEMs, notably LG and Sony, reducing losses.'”
On AAPL: Reiterate Buy, raise price target to $180 from $165. — Canaccord Genuity analyst T. Michael Walkley
Walkley’s quarterly spreadsheet in the full article here.
MacDailyNews Take: And that’s with the Mother of all iPhone Pauses already setting in, too!
[Thanks to MacDailyNews Reader “Dan K.” for the heads up.]
Whatever happened to “over 100%” profits?
The 88% from the quarter before is down from the 91% from the quarter before that. I hope this disturbing trend is just temporary in nature.
With only 13,5% market share, should it write.
Because that is an important point here.
True. But, this also indicates that others are starting to make profits too. It used to be almost exclusively Apple and Samsung making any profits at all, and Apple getting well over 90% of the profits. If that had continued for another year or three there would have been a major manufacturer shakeout. With others making profits too, the near profit guys will hang in there, investing in new phones and new systems.
Now the trend (forget worrying about the numbers for any one quarter — that’s just bean counter thinking) is that Apple is raking in a lower and lower percentage of the smartphone profits. That’s a trend that does not bode well for Apple’s money making machine. (And make no mistake, the current management at Apple is focused on things like iPhone profits and Apple’s money making machine — not on fantastic products in and of themselves.)
For the end user this is a good thing as this pushes the market and designs forward. For Apple, not so good. The days of Apple’s near monopoly on profits might be coming to and end within the next couple years. We’ll just have to wait and see.
Shadowself – understand your thoughts regarding Apple’s lower percentage of smartphone profits, but remember that the market isn’t static. Revenue from smartphone sales continues to rise – a 3% drop in overall smartphone profits does not necessarily mean that Apple’s money making machine is in trouble – or that they’ll be bringing in less revenue. If this trend continues over a number of years — maybe. Just don’t think it’s a clear cut win for consumers and a loss for Apple.
True, Apple just has to just drop slower than the entire profit total rises to keep ahead.
if you look at the chart in the article :value share Apple 83%, Huawei 5%, Samsung 14% the rest are zero or negative (the negatives I guess balances it out to 100%)
considering in 2013 the chart shows Samsung at 43% Apple is still going OK today although think Apple should take the down turn seriously (personally I believe lots of people are waiting for the iP 8 to buy) .
Last I read Samsung spends 10 times more money on advertising, I wondered how that affects sales and profitability?