“Samsung and Apple both got knocked down in trading this week even after reporting healthy results and soaring profits,” Parmy Olson reports for Forbes. “It’s hard to gauge what traders are thinking in the midst of short selling and locking in profits, but a big reason may be concern about the future for the dominant duo, and greater challenges in both developed and emerging markets.”
“The challenges are circumstance, and greater competition. The United States and most of Western Europe are saturated with smartphones, with American users in particular locked in to their devices for at least a year or more because of carrier contracts,” Olson reports. “But look East to where smartphone adoption is soaring, and the competition is getting brutal.”
Olson report, “Price is the main dilemma for Apple and Samsung. Their net profits grew to $13.1 billion and $6.6 billion respectively in the last quarter, largely by selling so many high-end smartphones and feasting on fatter margins. Apple sold 47.8 million, Samsung 63 million, both a substantial jump from last year. But with cheaper handsets being introduced by Chinese device makers, along with march of alternative, open-sourced mobile operating systems that are also cheaper to run, it’s no wonder that Apple is under pressure to release a cheaper iPhone, and Samsung is preaching caution… China’s Huawei is now the third-biggest smartphone manufacturer in the world by shipments, according to IDC’s latest quarterly survey of the industry. Its year over year growth in shipment was a phenomenal 89.5%.”
Read more in the full article here.
MacDailyNews Take: Huawei, ZTE, etc. give new meaning to “Chinese junk.”
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Analyst: Apple dominating U.S. smartphone market, but international iPhone growth is slowing dramatically – January 25, 2013