iPhone takes third of smartphone profits
Apple's iPhone has propelled the company to the heady heights of a 32 percent share of the smartphone sector profits - at only 8 percent share of revenue.
As reported by CNet, analyst Toni Sacconaghi of research firm Bernstein Research is claiming that the iPhone has lead Apple to take a whopping 32 percent of overall profits in the smartphone sector - certainly nothing to be sneezed at for a first attempt at a handset.
While the profit figures are impressive, it's not until Sacconaghi compares it to revenue that things get mind-boggling: the company's 32 percent share of overall sector profits comes despite being responsible for a mere 8 percent of overall revenue.
Sacconaghi's report, quoted in an article on the AllThingsD site, states that Apple's soaring profit margins come as a direct result of the integration between the handset and the company's digital download App Store service which has "established a formidable smartphone ecosystem, which history suggests is very difficult [for rivals] to overcome."
Sacconaghi ends the report with a bit of advice for Apple: while its 'formidable ecosystem' might help it to grow turnover faster than the industry average, a drop in price - and in those clearly impressive profit margins - would "expand its addressable market opportunity." The analyst certainly has a point: the report shows that Apple's average margins on the iPhone are a whopping 40 percent - double that of companies including Research in Motion (20.7 percent) and Motorola (21 percent), and almost four times that of Nokia (11.3 percent).
Do you believe that the iPhone could enjoy total ubiquity if only Apple's margins weren't so high, or would a drop in price hurt the company's plans and high-end image? Share your thoughts over in the forums.
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15 Comments
Discuss in the forums ReplyPersonally, I know few people who are prepared to dump so much money into one.
only other choice is the pre
Their actual market share is pretty damn small. There is a topic on the news section of the guru3d forums. I'm on my Blackberry (heh, irony) at the moment, so finding it would take too long (I'm also at work!), but I will link it later if you want.
Irony?
http://forums.guru3d.com/showthread.php?t=301153
1% of the total mobile phone market is still pretty big I suppose.
I would also be interested in viewing the third-party reporting company that provided many of the statistics listed.
But I guess that's the way of the world.
I actually meant this one, but they both have the same numbers. Although this one has a lot of details on the whole of Apple's ranges and their market shares.
At which point did you look at the hardware ability of the iPhone and think 'Yep, that's equivelant to phones of the same price'????
This is apple, they always overcharge for mediocre hardware that is, admittedly, very nicely designed to look at.
As long as people will pay that price, they will keep on selling it at that price.
Also I have to ask... 32% of which smartphone sector? the US only? Nokia holding abut 40% of the cell market, with samsung and Sony close behind (all three being actual smartphone makers), i highly doubt that apple's profit margins even come close to the top 3 of the cell world.
Actually the vast majority of the industry class a smartphone by whether it's operating system can support third-party applications. The iPhone's OSX can, therefor it's a smartphone.