Apple’s Smartphone Profits Continue To Take The Lead, Despite Samsung Selling More Smartphone Units
In the last quarter, Samsung shipped about 50 million smartphones, which is double the amount that Apple sold according to All Things D. Samsung’s number of shipped devices is the largest number of units ever shipped by a handset vendor in a single quarter. This is great and all, but Apple is still ahead in terms of actual profit, despite the number of devices shipped.
Thanks to the higher gross margins of the iPhone and iPad, Apple continues to be the leader in both revenue and operating profits. According to Raymond James analyst Travis McCourt, Apple only shipped about 6 percent of the industry’s smartphones and tablets in the second quarter but still managed to earn about 43 percent of the industry’s revenue. Apple also accounted for 77 percent of the industry’s operating profits. This is pretty impressive, especially considering this is during a weaker period for iPhone sales with the next generation iPhone just around the corner.
McCourt says, “Ultimately, profits are the feedstock of innovation; and, innovation drives profits. Until Samsung starts generating more profits than Apple, we would not be overly concerned with who has the unit share lead. Remember, HP and Dell still sell a lot more PCs than Apple sells Macs, but does it matter?”
While the number of devices shipped by Samsung is an accomplishment in itself, Apple ultimately comes out on top where it matters most.