Apple is raking in 94% of all smartphone profits

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  • 6 years ago

That’s the price you pay.

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Apple is raking in a whopping 94% of the world’s smartphone profits, despite selling fewer handsets than Samsung, the latest figures suggest.

A Canaccord Genuity report indicates that the iPhone maker achieved the impressive profit share while claiming just 14.5% of global smartphones sales during the third quarter of 2015.

By comparison, its closest rival Samsung snagged  24.5% of global sales during the three-month period, but came away with just 11% of the profits.

Quick arithmetic will tell you that those profit figures exceed 100% – this is because several phone makers, including HTC and Sony, reported negative operating income for the quarter.

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Apple achieved such high profits on relatively low shipments because of the amount it charges for the iPhone, according to Apple Insider.

The average cost of an iPhone during the quarter was around £440. Couple this with high operating margins of 37% and Tim Cook and his band of merry men are in the money.

Samsung’s average handset costs around £118, and margins of 10% meant that it made less from each phone, despite shifting more than Apple.

Apple’s profits were up almost 10% year on year, but are not expected to peak until the fourth quarter, which will take Christmas sales into account.

 

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