Apple Occupied 66% Of The Smartphone Industry's Total Profits, Far Better Than Samsung

Dhir Acharya - Dec 24, 2019

Apple has dominated the global phone mark with 66 percent of the total profits of the industry and 32 percent of the total revenue in Q3 2019.

2019 has been a good year for Apple. Its products, including the iPhone, MacPro, and the MacBook Pro, are back in the market and selling well. According to a new Counterpoint Research report, the tech giant has dominated the global phone mark with 66 percent of total profits of the industry and 32 percent of the total revenue in the third quarter this year.

These results come at a time when the global market has witnessed a downfall of 11 percent in profits year over year, which equals $12 billion. This overall decline was attributed to various mid-range smartphones as well as a year-on-year decrease in revenue.

Among 10 biggest smartphone makers, only Huawei and Samsung managed to increase their revenues year over year.

Counterpoint research analyst Karn Chauhan said that one of the main reasons for Apple to be able to keep getting profits is that it has loyal premium customers in major markets like Japan, the EU, and the US, which its competitors cannot have.

The iPhone maker has an ecosystem, along with services, that will help it maintain a steady revenue flow in the coming years. Karn additionally said that in the immediate future, Apple will earn more profit in the holiday season as its iPhone 11 lineup is getting good traction.

Another reason behind the decline in global smartphone sales is that people are holding longer on their phones. Besides, newer phones aren’t good enough for consumers to upgrade while their current phones are too good already.

Despite operating on low-profit margins, smartphone brands from China have got better over the years, they are now selling products in other markets than just their home country and entering higher-end segments.

However, Chinese brands are facing the challenge of raising their ASPs (average selling prices) as consumers are taking longer to upgrade and Apple is lowering prices of stock keeping units (SKUs), limiting the headroom used by Chinese vendors to raise their ASPs.