Android may have the market share, but it’s an entirely different story when it comes to profit share: the latest estimates from Canaccord Genuity indicate that Apple takes 92% of the profits for the entire smartphone industry despite accounting for only 20% of sales.
Or, as the WSJ puts it:
Roughly 1,000 companies make smartphones. Just one reaps nearly all the profits.
Samsung took a further 15% of the profits – and if you were wondering how that rather odd math works, it’s because most of the other players make a loss, so the two companies make more profit between them than the smartphone industry as whole …
Canaccord CEO Mike Walkley said that at the time Apple first entered the smartphone market in 2007, Nokia was taking around two-thirds of the profits (a far cry from today). By 2012, the profit split was around 50:50 between Apple and Samsung. Since then, he said, the “high-end tier has really shifted away from Samsung to Apple.”
Apple’s share of smartphone profits is up from 65% a year ago, though very slightly down on its 93% share in the holiday season. It has been reported that Apple plans to produce a record number of iPhone 6S handsets this year, aiming to top 90M units by the end of the year.