Apple And Samsung Continue To Eat Up Smartphone Profits

Apple and Samsung account for the vast majority of smartphone profits.

The two smartphone stalwarts took an astounding 106 per cent of industry profits in the third quarter, according to estimates from Canaccord Genuity. The number is greater than 100 per cent because Canaccord calculates profit share as “value share,” which includes profits to offset other manufacturers’ losses (losses are counted as negative value share). 

HTC was the only other profitable manufacturer, but just barely. Not included in Canaccord’s analysis were fast-rising Chinese manufacturers like ZTE and Huawei.

It is also evident that Samsung is eating up an increasing value share of manufacturer profits. Samsung took 47% value share, compared to 37% at the end of the second quarter. Not necessarily at the expense of Apple—the average selling price of iPhones is remarkably stable—but through scale alone. Canaccord estimates that Samsung shipped more than twice as many smartphones as Apple last quarter.

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