Apple’s Share of Phone Handset Industry Profits Climbs to 92 Percent

Shira Ovide and Daisuke Wakabayashi, reporting for the WSJ:

Roughly 1,000 companies make smartphones. Just one reaps nearly all the profits.

Apple Inc. recorded 92% of the total operating income from the world’s eight top smartphone makers in the first quarter, up from 65% a year earlier, estimates Canaccord Genuity managing director Mike Walkley. Samsung Electronics Co. took 15%, Canaccord says. Apple and Samsung account for more than 100% of industry profits because other makers broke even or lost money, in Canaccord’s calculations. […]

Apple’s share of profits is remarkable given that it sells less than 20% of smartphones, in terms of unit sales.

At just 20 percent of unit sales, Apple isn’t even close to a monopoly. At 92 percent profit share, they have a market dominance that rivals any actual monopoly the tech industry has ever seen. We don’t even have a term for this situation, it’s so unusual. Profit monopoly?

Monday, 13 July 2015