Apple continues to dominate with massive 86% share of handset industry profits

Apple Insider ^ | November 4, 2014 | By Neil Hughes

[Swordmaker]

A new analysis of third-quarter handset industry operating profits estimates that Apple accounted for a massive 86 percent share, blowing away the competition as rivals such as Samsung saw their profit levels dip.

Analyst Michael Walkley of Canaccord Genuity issued a note to investors on Tuesday, a copy of which was provided to AppleInsider, in which he revealed his latest research, based on company reports and estimates. Walkely said that Apple's estimated 86 percent share of industry profits was simply "remarkable."

Apple's gains came at the cost of competitors, most notably Samsung, which was estimated to have accounted for just 18 percent of the industry's profits. That's the lowest total for Samsung since 2011, Walkley said.

Still, Apple and Samsung combined for more than 100 percent of the industry's total profits, because competitors such as Motorola and Microsoft actually lost share. In fact, other than Apple and Samsung, the only other company to have a positive value share in the September quarter was LG with 2 percent, according to Walkley.

HTC and BlackBerry are estimated to have accounted for 0 percent share in the quarter, essentially breaking even. And Motorola with an estimated mobile operating loss of $185 million is said to have accounted for -2 percent, while Microsoft's $341 million estimated lost in handsets gave it -4 percent of the industry's profit value share.

In all, Walkley estimates that the handset industry saw operating income drop 17.3 percent year over year. The analyst did note that the increasing popularity of Chinese smartphone makers are not included in his estimates, due to a lack of available data on sales and profits.

Walkley also conducted a series of surveys in October in the U.S. which revealed that the iPhone 6 and iPhone 6 Plus were by far the top selling smartphones at all four major American carriers. The survey also found that users are gravitating toward higher-capacity iPhone models, which he believes will bode well for the device's average selling price in the current December quarter.

"We believe Apple is experiencing a record iPhone 6 upgrade cycle due to very strong replacement sales as well as from high-tier smartphone market share gains from Android," he said. "We believe these trends should result in very strong (fourth quarter of calendar 2014) smartphone sales and share gains for Apple.

Canaccord Genuity has maintained its $120 price target and "buy" rating for AAPL stock.

[Swordmaker]

agreed. This tells me Apple charges a whopper for their phones compared to the actual cost. Good for them. They get suckers to pay so much.

You'd make a good failure in business. . . treating your customers as "suckers." Apple provides value to its customers and as a result they have the highest customer satisfaction in the world. Suckers don't give that to companies that cheat them.

Time to rethink your conclusions.

[Swordmaker]

you are correct — they are not overpriced as the price is what many people (me excepting) are willing to pay.

Price is often the least part of the TOC, the total cost of ownership. Multiple studies have shown that Apple products have the lowest cost of ownership over time. FAR lower than any Windows computer.

[FredZarguna]

Nope. Don’t. Please don’t comment on stuff — like program development — that you know nothing about. There are similators for sensible people who have more sense than you fanbois.

[Swordmaker]

I work with someone who develops apps for iOS and Android in her spare time. She absolutely hates the Android IDE and has told me repeatedly how much easier it is for her to develop for iOS. And she isn't a long-time Apple devotee but rather a Windows programmer by day.

As I said, Fred is lying. Here is a commentary from a developer who works with both platforms from last year:

"Apple’s is Xcode, which is, by and large, a joy to work with. It’s slick, fast, powerful, helpful without being intrusive, and it keeps getting better at papering over both the unheimlich compilation machinery beneath its glossy exterior, and the complex and paranoid certificate/profile machinery which Apple imposes on developers to retain its titanium-fisted control over iOS apps and devices. The debugger works seamlessly, and the simulator is fast and responsive.

But Android? Oh, Android. The current state-of-the-art IDE is Eclipse, customized with Android plugins, and it is embarrassingly bad. Slow, clunky, counterintuitive when not outright baffling, poorly laid out, needlessly complex, it’s just a mess. Its debugger is so clumsy that I find myself doing log-file debugging most of the time, whereas the XCode debugger is my iOS go-to bug-hunt tool. And the less said about the Android emulator, which takes minutes to launch and then half the time fails to connect to the Android Debug Bridge, the better. . .

And The Winner Is…

iOS, and by some distance. Android has its advantages, but overall, it remains significantly easier to write good iOS apps than good Android apps. Combine that with the fact that iOS users tend to be wealthier–and arguably more influential–and it still makes sense for most startups who want to make a splash to go iOS-first, Android-later. The new Android Studio IDE could conceivably close some of that gap…but not all of it.

(For the record, my own primary phone is a Nexus 4, and I’m very happy with it.)— TechCrunch "Android vs. iOS Development: Fight!", Jon Evans, 11/13/2013

Granted that article is a year old, and Android development SDKs have improved somewhat with the release of Android Studio, but so have Apple's and Apple has released Swift, an entire new Programing Language, that makes it even easier to program for iOS and OS X.

[FredZarguna]

Anyone who claims Objective-C is anything other than a thorough abortion is a jackass whose opinion is worth exactly nothing.

[Swordmaker]

PC Magazine? I don't know of any serious IT/ITS person or developer who takes either of those two magazines seriously anymore. They're strictly consumer publications. And consumer publications are not respected in my trade; I'm sure Apple "computer experts" think they're great.

How about Anandtech? Here's a quotation from Anandtech on MacBooks.

Apple’s 13-inch and 15-inch MacBook Pros with Retina Displays are simply the best available notebooks, and which you choose depends totally on budget and priorities over anything else. If power is what you’re looking for, look no further than the 15-inch reviewed here.— Anandtech, "Late-2013 15-Inch Retina MacBook Pro Review: Apple’s High-Performance Notebook Tops The Field", Darrell Etherington, 10/25/2-013

How about CNet Magazine?

MacBook Pro declared 'best-performing' Windows laptop
A PC services company placed Apple computers in the No. 1 and No. 6 slots as the best-performing Windows laptops.

An Apple 13-inch MacBook Pro is the "best-performing" Windows laptop? Yes, says a PC services company that has done "frustration analytics" on some of the best-selling PCs.

The MacBook Pro won out over established PC makers like Dell, Acer, and Lenovo, according to Soluto, which was quick to explain its finding.

A main factor in this machine's metrics is the fact that every Windows installation on it is clean. With PC manufacturers loading so much crapware on new laptops, this is a bit of an unfair competition. But, on the other hand, PC makers should look at this data and aspire to ship PCs that perform just as well as a cleanly installed MacBook Pro.

The report went on to admit that it might be more fair to compare a cleanly installed MacBook Pro with a cleanly installed PC from Acer or Dell.

But there's method in Soluto's metrics: "We simply compared the real PCs in the field....We believe it's more representative of reality."

The metrics (see image at top) include crashes per week, hangs per week, Blue Screens (of Death) per week, and average boot time.

Soluto did list the disadvantages of running Windows on a Mac, including that it's more work to set up Windows on a Mac and there may be driver issues.

Acer's Aspire E1-571 came in second and Dell's XPS 13 received the third-highest ranking.—CNet Magazine, "MacBook Pro declared 'best-performing' Windows laptop", by Brooke Crothers, 04/24/2013 3:49 PM PDT

Are THOSE better than PC World's and PC Magazine's judgments, Fred?

Then there's Laptop Magazine, which tests every laptop released and runs benchmarks on all of them.

The new 15-inch Apple MacBook Pro with Retina Display is the ultimate notebook for power users, combining a best-in-class display with blazing performance and long battery life. . .

At $2,599 for our configuration ($1,999 to start—upgraded to 16GB and much larger SSD, Swordmaker), the 15-inch MacBook Pro represents a serious investment, but it also delivers a serious dose of power and endurance in a portable design.

The new Retina MacBook Pro offers very fast quad-core performance paired with some of the fastest flash storage around and (optional) discrete graphics, making quick work of pretty much any task. At the same time, this is the only 15-incher we've tested with this much muscle that can last nearly 9 hours on a charge. The only drawbacks we encountered were a slightly toasty undercarriage toward the back and moderate fan noise (both under heavy use). . .

Those with less demanding needs who travel often are better off with the considerably cheaper and lighter new $1,299 13-inch MacBook Pro. But if you want the fastest notebook for creative pros that can go the distance, the buck stops here.— Laptop Magazine, "Apple MacBook Pro 15-inch Retina (2013) Review", Mark Spoonauer, 10/24/2013

I notice you have not bothered to respond to any of the benchmarks I have posted in reply #38 on the Ransom Note 4 and the iPhone 6 and 6 Plus. . . but then you wouldn't because it shoots down your superiority claims.

Checkmate.

[Swordmaker]

How are the Chinese to keep them kids out of mischief?
Maybe they work in the mines instead

Pfffft. They aren't working at Apple assembly lines. The rest is not the problem of the United States. It is China's.

[FredZarguna]

CNet? Wow keep making my points for me there, Mr. Clueless.

CNet?

Hahahahahahaha.

CNet!

You're kiing me with your completely gormless replies.

CNet. Wow. Just. Plain. Wow.

[Swordmaker]

Nope. Don’t. Please don’t comment on stuff — like program development — that you know nothing about. There are similators for sensible people who have more sense than you fanbois.

So you agree with my comment. . . that is correct in every thing. Then you tell me I don't know what i am commenting about? Simulators are not the real thing. You should know that. Or do you prefer your latex dolls you keep in your basement to real women? YOU are the one on this thread that has demonstrated an ignorance as deep as the Grand Canyon. Sorry, the Echo is deafening.

[Swordmaker]

CNet. Wow. Just. Plain. Wow.

Still no responses to the published benchmarks shooting down your unsupported claims of Samsung Ransom Note 4 superiority. How about posting something substantive? Nothing linked to ANYTHING, anywhere. Just your unsupported idiocy.

[Swordmaker]

You're kiing me with your completely gormless replies.

CNet. Wow. Just. Plain. Wow.

By-the-way, your reply about me being "gormless" and your disdain for CNet, are merely ad hominem attack which is totally worthless in debate. It has no value. You also ignore Anandtech's claim, and Laptop Magazine. . . your lack of facts is absolutely stunning.

By the way? is "Kiing" missing an "S" at the start or two "Ls" in the middle? We are still waiting for your responses that have ANY grounding in reality. You have yet to lay a glove on any of us. You need facts to do that, and, frankly, Fred, your are coming up totally empty in that department.

[minnesota_bound]

The guy who started Anandtech now works at Apple.

[Swordmaker]

The guy who started Anandtech now works at Apple.

He recognizes a quality place to work. That review was not written by him.

[PreciousLiberty]

"Anyone who claims Objective-C is anything other than a thorough abortion is a jackass whose opinion is worth exactly nothing."

You've just revealed the depths of your ignorance and incompetence. Congratulations?

The NeXT computer, when it was introduced, was almost universally hailed as a leap forward in software development. It's centerpieces were Nextstep Developer and Interface Builder, all built around Objective-C. Since then Objective-C has enabled the creation of over a million iOS and Mac applications with dazzling success.

You should read this piece NeXTStep VS. Other Development Environments to educate yourself a bit.

Objective-C does have its warts, and that has inspired Apple to create Swift, a modern, clean language built on an Objective-C foundation.

[FredZarguna]

Unfortunately for you, Apple agrees with me.

First, they realized that increasing numbers of developers were refusing to use Objective-C. That couldn't be allowed while spoiled little rich boy Jobs was still alive; it was his toy language, and would have ceased to exist decades ago if not for his continued fanaticism.

So what did iEvil do? They decided to mandate what languages could be used for development. Oops. Huge mistake. A revolt ensued, and iEvil quickly backed off -- not openly, they could never do that -- but behind the scenes they continued to accept Xamarin/Mono and other development tools they'd previously said would absolutely not be permitted. Now Objective-C is history -- not officially deprecated, but any developer with half a brain won't be using it for long except in legacy applications.

Swift based on objective-C? Please be serious. The language developer says, quote, Swift took language ideas "from Objective-C, Rust, Haskell, Ruby, Python, C#, CLU, and far too many others to list."

Really? Well I guess he gets more points for honesty than iEvil usually deserves credit for. He admits they stole it, just like they've stolen everything else, although he pretends there's some Oblivious-C in there, somewhere. Is this syntax "based on Objective-C?"

var str = "hello,";
str += " world";

Why no, it isn't. It doesn't even bear resemblance to Obstructive-C. It would have compiled with "typedef string var;" as C++ in 1985. It would compile without alteration as C# right now. If Objective-C was so great, Apple wouldn't have pulled the rug out from under it.

They have, because it sucked.

Oh, and I have no doubt, in ten years, I'll check back in here, and I'll be reading how Apple actually "invented" string concatenation with this exact operator syntax and all, long before anyone else did. And naturally, you fanbois will mindlessly be howdy-doodying, "Yup, Yup. They did. Invented everything. All the way back to Algol-60. It's a fact."

You little cheerleaders are as bad as the commies for turning on a dime once you get your marching orders. Last generation of iPhone was great because it was so tiny, and Samsungs BIG BIG phone was "some kind of joke." Now big phones are GREAT! For years I had to read about how awful Java and C# were because you didn't have to manage your own memory the way you do in Oblivious-C. Now garbage collection -- of which ARC is just one form -- is supergreat. Actually it's a primitive approach, which is superior to manual memory management for most coders, but it's a poor design decision that Apple will no doubt have you fanbois out there defending... until it falls completely flat. About ten years later, they'll [finally] figure out how to write a decent nondeterministic garbage collector and you'll once again be turning on a dime.

[minnesota_bound]

Read the Tragic Poetry of a Foxconn Factory Worker Who Committed Suicide
https://www.yahoo.com/tech/discovered-the-tragic-poetry-of-a-foxconn-factory-101943982149.html

[Swordmaker]

Read the Tragic Poetry of a Foxconn Factory Worker Who Committed Suicide

That is both tragic and prophetic. Well written and very sad. That poor worker was at a plant working on Microsoft X-Boxes, I believe. Thank you for the ping.

[GeronL]

how much does Foxconn pay?

consider that the average in China is $656 a month (less than India)

[GeronL]

they tie their kids to the wall of the factory

http://www.chinasmack.com/2010/pictures/chinese-children-tied-up-while-parents-work-zhejiang.html

[Swordmaker]

You little cheerleaders are as bad as the commies for turning on a dime once you get your marching orders. Last generation of iPhone was great because it was so tiny, and Samsungs BIG BIG phone was "some kind of joke." Now big phones are GREAT! For years I had to read about how awful Java and C# were because you didn't have to manage your own memory the way you do in Oblivious-C. Now garbage collection -- of which ARC is just one form -- is supergreat. Actually it's a primitive approach, which is superior to manual memory management for most coders, but it's a poor design decision that Apple will no doubt have you fanbois out there defending... until it falls completely flat. About ten years later, they'll [finally] figure out how to write a decent nondeterministic garbage collector and you'll once again be turning on a dime.

Fred, your bile laden screen is absurd. But the iPhone is not great last year of this year because of its size. Nor were we ever touting size as the reason. . . although pocketability, the ability to hold it one handed, reach the keys on the virtual keyboard, and how a phone looks held up to one's ear are important to consumers. The iPhone is great because of its top-to-bottom integration in its ecosystem, something no other phone does so well. I know of no "Apple fanbois" defending any programing languages Apple uses. They are just engineering choices. We defend the RESULTS Apple gets. That is what counts.

You can spill your bile all you like, but that doesn't seem to matter to you in your unreasonable hate.