Apple iPhone achieves ‘an impossible dream’

Ewan Spence writes for Forbes, “Even though it looks like an impossibility, the latest report from BMO Capital Markets suggests that Apple has taken 103.6 percent of the industry’s profit.”

“How the available money for profit is calculated explains the anomaly of going over the 100 percent mark,” Spence writes. “Because the losses made by companies on their smartphone projects are included in the ‘profits available’ calculation, there’s more money in the system than the money handed over by buyers around the world. Once you include Samsung’s increased losses due to the Note 7 debacle, Apple’s profit goes over the 100 percent mark.”

“What’s more important to note is that Apple managed to bring in this level of profit on just twelve percent of the [unit] sales in the smartphone sector [or market share],” Spence writes. “That money can be used to fund more research, more development, and more design. Not only does that benefit Apple, but the competition has less money to fund those same resources, increasing the potential lead between the iOS and Android platforms.”

Read more in the full article here.

MacDailyNews Take: Market share, schmarket share.

SEE ALSO:
Total dominance: Apple iPhone takes 104% of smartphone industry profits – November 4, 2016

14 Comments

  1. And maybe this explains to some degree the issue with Mac’s not being updated. Haven’t seen a company in the world yet manage two operating systems, let alone multiple hardware offerings for those systems as well. Maybe it takes an enormous effort by Apple to keep the iPhone so desirable and advanced, that there isn’t enough time from those senior managers to properly advance the Mac platform. It’s not a matter of money, it’s a matter of available talent. Money doesn’t solve the talent problem. The right talent is really hard to find and manage.

    1. “Haven’t seen a company in the world yet manage two operating systems, let alone multiple hardware offerings for those systems as well. ”

      There are lots of companies that do this. Apple was one in the 1980’s:” Apple II, Apple III, Lisa, Mac, Rosetta (PowerPC vs Intel). and more recently, iOS, macOS, and their server OS.

      IBM

      Samsung

      Motorola

      All it takes is the right management that knows how to delegate. Tim does not need to know the details of everything and whether he does or not I don’t know because I don’t know how he manages and I’m not impressed any longer with his managers.

      While Apple R&D budget seems large yet reasonable for their size, I am quite disappointed with their results and accomplishments. Wonder where it is being wasted.

      What’s wrong with a great truck, especially one with the same steering wheel and brakes and other controls as your little car?

    2. You’re kidding me right? Apple basically has one product. With all those employees if they can’t manage more than one significant product and then some MacBooks and an Apple Watch there are bigger issues.

  2. I’ve been waiting years for the android market to consolidate or for many manufacturers to drop out of making them entirely.

    Yet this doesn’t happen.

    How is it that so many companies can pump in millions upon millions of losses and not give up?

    Is Google funneling money into them to dump android products on the market? It makes no economic sense to me how they can remain in business for so long.

  3. Wise words chazz15. It is a question of focus and attention, too.
    The question becomes, at which point to you split P&Ls and let a part run as its own division.
    But as always, the Mac problem is widely talked about while sales and profits with Macs are stable, and will actually rise with the new MacBook Pro. Growing this business steadily in a declining overall market – is that not enough?

  4. I suspect Apple will continue to dominate smartphones as the need to inter-operate between mobile and desktop devices continues to become far more important over time.

    People in college today are not going to want to use devices that limit or slow them down.

    1. I suppose that’s fine for the individual person’s devices but when the need comes to inter-operate with devices other’s own you really can’t depend on them having the same equipment let alone OSes.

  5. Ewan Spence has suddenly had a “lightbulb moment”, putting his continuous mocking of Apple inc. on hold for some peculiar reason.

    Maybe Samsung have stopped paying his bill, with all the exploding Note 7’s and now Washing machines to deal with!

  6. google is looking mighty good.
    its pixel is good.
    and its eco-system is getting to be really atractive.
    and, i am now thinking more and more that as long as there are real advantages to the model where “I” and “my data” are what google trades in and sells, as long as they can make my digital life connected and easier and more useful for me, then i am voting for them.
    apple needs to be careful. very careful.

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