Ap­ple’s out­sized prof­its

Daily Freeman (Kingston, NY) - - BUSINESS -

Ap­ple may be wrestling with a slump in iPhone sales this year, but it still en­joys an out­sized share of in­dus­try prof­its.

As global de­mand for smart­phones has slowed, some Asian phone mak­ers are los­ing money on their prod­ucts. In ad­di­tion, Sam­sung, the world’s largest smart­phone maker, took a hard hit on its re­called, fire-prone Galaxy Note 7. Con­se­quently, Ap­ple’s oper­at­ing profit for the July-Septem­ber quar­ter was greater than that of all smart­phone mak­ers com­bined, an­a­lyst Tim Long of BMO Cap­i­tal Mar­kets es­ti­mates.

Even in the second quar­ter, with­out the re­call, Long es­ti­mates Ap­ple made 70 percent of the in­dus­try’s second-quar­ter prof­its, with Sam­sung gar­ner­ing 32 percent. Both HTC and LG lost money. Canac­cord Ge­nu­ity’s Michael Walk­ley es­ti­mates Ap­ple made $9 bil­lion in oper­at­ing profit by sell­ing 40.4 mil­lion iPhones in the second quar­ter. While that’s only 12 percent of all smart­phones sold in the quar­ter, the iPhone com­mands a pre­mium price and profit mar­gin. Over­all, the smart­phone in­dus­try is un­likely to grow much more, Long warned in a re­cent re­port. But he and Walk­ley both con­tend Ap­ple can con­tinue to in­crease its mar­ket share – and prof­its.

Newspapers in English

Newspapers from USA

© PressReader. All rights reserved.