Feeds

Android mobes outsell iPhones, but Apple gets MORE PROFIT THAN ALL

Tim Cook: 'We're not in the junk business.' The cash-gobbling business, however...

Top 5 reasons to deploy VMware with Tegile

Apple rakes in more profits from its iPhones than all Android phones combined, despite the fact that Android phones command an 81 per cent market share to Cupertino's 12.1 per cent.

Earlier this week, IDC reported that Android was used in four out of five smartphones shipped during the third quarter of this year, with Apple, Windows Phone, and Blackberry far behind.

On Thursday, however, another report revealed that despite Android's overwhelming market-share lead, Apple's operating margin of 33 per cent enabled it to haul in 56 per cent of all handset profit.

"The latest data from Canaccord Genuity ... estimates that Apple took 56 percent of the operating profits for feature phones and smartphones in the third quarter of calendar 2013," reports AppleInsider. Close behind was Samsung, with 53 per cent of what Canaccord Genuity calls the "value share" of the handset market.

Surely you, sharp-eyed Reg reader, immediately noticed that those two figures add up to 109 per cent of the smartphone and feature phone value share, and asked, "How the %$#@! is that possible?"

Canaccord Genuity 'value share' data

Apple in the lead, with Samsung closing fast (source: Canaccord Genuity via AppleInsider – click to enlarge)

Simple. Most of the competition – Nokia, BlackBerry, Motorola, LG, and HTC – lost money during the quarter. The only other phone vendor surveyed who didn't – Sony – simply broke even.

To be scrupulously fair, it should be mentioned that AppleInsider's Cannacord Genuity source told them that Chinese phone folks Lenovo, ZTE, Huawei, and Coolpad were not included in the analysis because their profitability numbers aren't available, and that if those profits – or losses – were factored in, Apple and Samsung's value share would likely be lower.

But not by much.

The figures demonstrate two simple facts. First, that in the world of smartphones and feature phones, it's very much a two-horse race between Apple and Samsung – and Cupertino doesn't even play in the feature-phone market. Second, market share does not equal profit share. Not by a long shot.

A hefty chunk of those Android phones are cheapo devices with razor-thin profit margins. As IDC pointed out this Tuesday, the average selling price for Android phones is steadily sinking, down 12.5 per cent in the third quarter of this year alone to an average of $317.

Prices that low – and that's the average, remember – may grab a lot of market share, but it won't make you a company with the world's largest market capitalization. As of this Friday, Apple's market cap stood at $475.2bn, with number-two Exxon Mobil coming in at $407.2bn. Samsung, by the way, has a market cap of $217.2bn – less than half of Apple's.

Apple CEO Tim Cook's focus on the high end of the smartphone market – "We're not in the junk business" – seems to be working.

For now, at least. ®

Security for virtualized datacentres

More from The Register

next story
PEAK APPLE: iOS 8 is least popular Cupertino mobile OS in all of HUMAN HISTORY
'Nerd release' finally staggers past 50 per cent adoption
Tim Cook: The classic iPod HAD TO DIE, and this is WHY
Apple, er, couldn’t get parts for HDD models
Apple spent just ONE DOLLAR beefing up the latest iPad Air 2
New iPads look a lot like the old one. There's a reason for that
Google Glassholes are UNDATEABLE – HP exec
You need an emotional connection, says touchy-feely MD... We can do that
Microsoft fitness bands slapped on wrists: All YOUR HEALTH DATA are BELONG TO US
Wearable will deliver 'actionable insights for healthier living'
Lawyers mobilise angry mob against Apple over alleged 2011 Macbook Pro crapness
We suffered 'random bouts of graphical distortion' - fanbois
Caterham Seven 160 review: The Raspberry Pi of motoring
Back to driving's basics with a joyously legal high
Back to the ... drawing board: 'Hoverboard' will disappoint Marty McFly wannabes
Buzzing board (and some future apps) leave a lot to be desired
prev story

Whitepapers

Why and how to choose the right cloud vendor
The benefits of cloud-based storage in your processes. Eliminate onsite, disk-based backup and archiving in favor of cloud-based data protection.
A strategic approach to identity relationship management
ForgeRock commissioned Forrester to evaluate companies’ IAM practices and requirements when it comes to customer-facing scenarios versus employee-facing ones.
High Performance for All
While HPC is not new, it has traditionally been seen as a specialist area – is it now geared up to meet more mainstream requirements?
Top 5 reasons to deploy VMware with Tegile
Data demand and the rise of virtualization is challenging IT teams to deliver storage performance, scalability and capacity that can keep up, while maximizing efficiency.
Mitigating web security risk with SSL certificates
Web-based systems are essential tools for running business processes and delivering services to customers.