Strategy Analytics is today out with a new report dissecting the profits of the mobile industry during the third quarter of 2016. The report estimates that the mobile industry took in operating profits $9.4 billion during the quarter, with Apple capturing a “record” 91 percent share of those profits…
In doing the math, Apple recorded $8.5 billion in profit from mobile industry sales during the third quarter of 2016, which consists of July through September.
Strategy Analytics director Linda Sui attributes Apple’s continually strong profit maximization to its finesse the relationship between pricing and production cost.
Apple’s ability to maximize pricing and minimize production cost is hugely impressive and the iPhone continues to generate monster profits.
Moving further down the totem pole we reach Huawei, which captured 2.4 percent of overall industry profits. Notably, this maxes Huawei the most profitable Android manufacturer for the first time ever. Vivo and OPPO come next, each accounting for 2.2 percent of global profits.
Tonight’s Strategy Analytics report is a bit more conservative than estimates from other firms. For instance, BMO Capital Markets earlier this month reported that the iPhone captured 103.6 percent of the mobile industry profits during the third quarter. For those wondering, Apple is able to do that because of companies such as LG and HTC recording losses on their smartphone division.
Apple officially reported $46.9 billion in revenue for its most recent quarter on sales of 45.5 million iPhones and an operating profit of $9 billion. Apple’s growth numbers were significantly drawn down by poor performance in China, but growth in 33 countries somewhat offset that.
The full Strategy Analytics press release can be read below:
Strategy Analytics: Apple Captures Record 91 Percent Share of Global Smartphone Profits in Q3 2016
Boston, MA – November 22, 2016 — According to the latest research from Strategy Analytics, global smartphone profits reached US$9 billion in total during the third quarter of 2016. Apple dominated and captured a record 91 percent share of all smartphone profits worldwide.
Linda Sui, Director at Strategy Analytics, said, “We estimate the global smartphone industry realized total operating profits of US$9.4 billion during Q3 2016. Apple dominated and captured a record 91 percent share of all smartphone profits worldwide. Apple’s ability to maximize pricing and minimize production cost is hugely impressive and the iPhone continues to generate monster profits. Huawei, Vivo and OPPO are the next three most profitable smartphone vendors globally this quarter, but they are still a long way behind Apple.”
Neil Mawston, Executive Director at Strategy Analytics, added, “We estimate Huawei generated US$0.2 billion of smartphone operating profit worldwide in Q3 2016. Huawei captured 2 percent share of all smartphone profits, taking second spot overall, and becoming the world’s most profitable Android vendor for the first time ever. An efficient supply chain, sleek products and effective marketing have been among the main drivers of Huawei’s robust profitability. Vivo and OPPO followed in third and fourth place and each took 2 percent global profit share. Vivo and OPPO delivered relatively healthy profitability due to disciplined pricing and soaring shipments across Asia.”
Linda Sui, Director at Strategy Analytics, added, “Three of the world’s top four most profitable smartphone vendors are currently Chinese. Huawei, Vivo and OPPO have not only improved their smartphone product lineups this year, they have also enhanced their operational abilities and kept a tight lid on expanding distribution costs.”
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