WSJ: Apple had 92% of smartphone industry’s profits in Q1 2015

by: Matthew BensonJuly 13, 2015
2.6K
lg g4 vs iphone 6 quick look aa (16 of 18)

Despite the countless advantages of Android, Apple has absolute control over smartphone profits.

According to The Wall Street Journal, there are now approximately a thousand different companies producing smartphones. That number is absolutely staggering, and should without a doubt infer that there are OEMs above and beyond the scope of knowledge of just about anyone.

But Apple it seems, receives almost all of the profits from the industry according to Mike Walkley, Canaccord Genuity managing director. Specifically, in the first quarter of 2015, it earned 92% of the total operating income from the world’s leading 8 OEMs, an impressive 65% increase over the same period last year. Samsung, on the other hand, received only 15%. (Because many companies actually lose money in the smartphone business, the total share of those who profit is bigger than 100%.) In light of all those other manufactures who aren’t mentioned, Canaccord estimates that they are essentially irrelevant (from this perspective) given that they “broke even or lost money.”

Apple’s market

The report explains that Apple “sells less than 20% of smartphones, in terms of unit sales” and that “the disparity reflects its ability to command much higher prices for its phones”, something that is no longer true of Android OEMs as they face an increasingly crowded marketplace. The result is a lack of core differentiation which has forced many companies to slash prices in order to appeal to consumers. This trend is totally alien from Apple’s attention, as last year the iPhone “sold for a global average of $624, compared with $185 for smartphones running Android, according to Strategy Analytics.”

BT-AD014_SMARTP_16U_20150712190305

It should be note that Canaccord’s data “doesn’t include privately held companies including Xiaomi and India’s Micromax Informatics Ltd.” however, “Mr. Walkley said those companies’ profits—if any—are unlikely to alter the industry-wide profit picture.” While some might be eager to speak otherwise, given the extremely low retail prices for these OEM’s products, it is basically assumed they are selling them at-or-around production costs, and thus what little profit to be had comes from selling massive numbers of product, or even from value-added services, offers, or accessories.

Google’s gain (as OEMs feel the pain)

While this report may enrage Android fans, especially those with more antagonistic views of Apple, this is little more than a reinforcement of just how profitable Cupertino’s business model is, and exactly why companies like Samsung are so eager to try and break free of Android. Indeed there is a certain element of irony at play here: many view Google’s “open” OS as pro-choice, yet Google’s overall business strategy is largely self serving. In other words, Google makes a lot of money of Android, even if actual most phone makers don’t.

It matters very little who makes Android phones, as long as the phones being made are running Google Play Services

Google wants Android on as many devices as possible, because each one is a potential profit center for the company’s main business: advertising. To Google, it matters very little who makes their phones, as long as the phones being made are running Google Play Services. This fractured reality is exactly why the “China situation” is such a pain in Mountain View’s side, and why it’s looking more likely 2015 will see the release of a Huawei Nexus.

Lollipop statue Android Google

Indeed as Android has gradually matured, Google has sought to exercise tighter control over the OS. Likewise, the once-flourishing sales of Samsung are ultimately of little concern now that Android has achieved its absolute market share dominance. Whereas the Galaxy series was once – arguably – the sole contender against Apple’s iPhone, the tables have turned and now any random would-be OEM can make a pretty decent smartphone.

Each Android phone is a potential profit center for Google's main business: advertising.

Notice, however, just how rare it is to find any given one (or tablet for that matter) that doesn’t run Google Play Services, something that used to happen on a somewhat frequent basis in the early days of Android and budget-friendly products. This is not to say they don’t exist, not at all, but rather there are just so many smaller-scale tablets that do support Play Services, the problem is nowhere near as pressing as it might once have been.

Profit pictures

HTC One M9+-23

Had HTC released the One M9+ as its flagship, perhaps the financial fall-out would have been somewhat lessened…or even staved-off entirely.

As far as key Android OEMs go and their potential for profits, the sad reality is that things don’t look good at all. Samsung had an extremely favorable reception when the Galaxy S6 was announced which prompted almost unreasonable projections of potential sales. Reports began to come in that painted a different picture, and in the more recent past it’s become quite clear that the Korean smartphone manufacturer will ultimately fail to live up to the lofty expectations many had set up. HTC is in a similar boat, largely due to its decision to release the One M9 as its flagship, despite an absolute menagerie of other prime products exclusively available in Asia. LG is also facing scrutiny given that the G4 has, by all accounts so far, failed to live up to its sales potential.

Meanwhile, over in Apple-land, rumblings of rumors couldn’t be more rosy. The WSJ points out that “events last week highlighted the lopsided financial picture [with] Apple…asking suppliers to make a record number of new iPhone models.” Given that the products expected to launch this year, the iPhone 6S and iPhone 6S Plus are – based on past releases – going to retain the same design but instead offer upgraded internals, it truly just shows how much power Apple has when it comes to products, purchases, and profits.

Unlike Apple, HTC or Sony can't get away with releasing iterative products.

HTC by all accounts, did the exact same thing with its One M9 and yet has met with disastrous results. Even Sony has faced intense scrutiny for this strategy given that the Xperia Z4 is basically a retread of the Z3, a reality that has literally forced the company to re-brand it as the Z3+ outside of Japan. How the tables might have turned had HTC at least had the foresight to release the One M9+ as its flagship, or had Sony deemed it fit to launch the Verizon-exclusive Z4v on a global scale.

Forecasting the future

Samsung-Galaxy-Note5-Schema-06

Even were it to feature a teleportation beam, it’s unlikely the upcoming Galaxy Note 5 would ever be able to transport Samsung back to its former finances.

It is unlikely that things will improve for legacy Android OEMs in the future. New rumors are suggesting that Samsung will launch its upcoming Galaxy Note 5 earlier than in the past, simply because it doesn’t want to compete with the iPhone’s juggernaut-strong offensive. Likewise, the company is expected to bring to market a super-sized Galaxy S6 Edge as clear competition for the new iPhone. The Note series has always been a less mainstream affair, and thus it is unlikely to move massive numbers enough to bring Samsung back to positive growth on a mass-scale, the likes of which it used to enjoy on a quarterly basis for year-upon-year in the past.

With even Android’s largest OEM facing slowing sales, the potential for smaller players is all the more marred, baring a major upturning of strategy. In their place will be dozens of companies from China, such as Huawei, Xiaomi, ZTE, who will be the ones to truly take advantage of the world’s emerging markets. These companies are not hell-bent on mass profits, nor do many of them have speculators or investors governing the decisions that go on behind the scenes the way that publicly traded companies do.

  • teomor

    So, basically, you’re saying that the OS is what holds these companies back from making profits? Hahahahha. That’s just stupid. If Samsung isn’t making any profits with Android, it sure as hell won’t with Tizen or whatever proprietary OS they come up with.

    • it’s me tim-cock.

      That is true. You have 80,000 oem making phone on that rat infested os name android, I believe Samsung would have a better chance of going with their own os, instead of God awful shithole call android.

      • bob

        rat infested is the word i’ve been looking for.

        everyone building phones with android is destined to be selling at no profit competing on useless specs without the capacity for major structural investments. just look at windows

        • Alex

          Pathetic

          • bob

            exactly

      • Dragonscourgex

        can you and mr. bobby boy over here please explain how you two came to the conclusion of the Android platform being a “rat infested platform”?

        • bob

          because it is full of no name brake even manufacturers dragging all the other oems down with them. couple that with the average android costumer looking only for good price and this is what you get.

          oems need money, they nit capital to make strategic purchases and r&d investments. whos gonna build the infrastructure for payments systems? micromax? only samsung can. what if samsung stops making money?

          people need to look beyond their wallets and see the bigger picture. as evidence shows, thats beyond capabilities of average android costumer.

          windows is evidence all you need. sure, microsoft is making money, but because they price windows. take a look at windows oems. compare their profit with mac division and you’ll see what im talking about

          in the long run, android ecosystem is getting more rotten day by day, all thanks to a thousand of rats slowly chipping it.

          then theres the whole brand situation. 50$ phone is running the same OS as 600$ phone? aint gonna work.

          • it’s me tim-cock.

            That I Agree with. No one else in android can match apple if Samsung goes away. I agree with you again that android users are some cheapskates who wouldn’t mind a $60 phone with earth shattering specs. What a bunch of loosers.

          • bob

            not cheapskates, just delusional

            their expectations of prices arent sustainable and is what is driving android into the ground.

            i wont even touch bona fide contractual ideals, or general unwillingness of android users to pay for apps, content etc., or how and why apple managed to dominate both high-end price smartphone segment, and people willing to pay both for high end devices and content/apps… ask google, if they had to choose, from the economical perspective, who would they rather keep, android or ios?

          • Dragonscourgex

            So, your reasons or
            1. There’s OEM that are trying to make budget phones, so people don’t have to spend $600-$700 dollars on a device.
            2. Because there are people that deem paying $600.00-$700.00 as too much money to spend on a device. Most likely because they have only a certain amount of cash, that must be use for other things, like food..clothes..lodging.
            3. Yes, you are correct that OEM need money to reinvest into R&D and such. But, believing one OEM can build out the infrastructure for any type of service, mobile payment as per your example, is disregarding a lot of factors that go into something like that. You have the financial institution that need to be on board, the carriers, and many other players. The major reason why Google Wallet never took off, was the blocking of major carriers in the U.S. If the carriers would have gotten on board, mobile payment could be more widespread than it is now.
            4. Again people only have a limited amount of cash flow. Some people cant’ afford to spend $600-$700 on a device.
            5. Can you please explain your Window example a little better. I’m lost on trying to see your point with this. Are we talking about mobile devices or desktops?
            6. “Android ecosystem” usually refer to the software side of thing. But , it seems your issue is with the hardware side.
            7. Again, a lot of people can’t afford a $600-$700 device. Why should they have a sub par experience just because they are limited by financial means.

            It seems to me, you issue with the Android OS is that they OEM that make budget phones. Am I miss reading your argument? If not, the OEMs have nothing to do with the Android OS.

            I have used both iOS and Android devices. I am currently using a OnePlus One. A $350.00 dollar phone. My personal experience has been nothing but joy with it.

          • bob

            1. the race to the bottom is unsustainable. price isnt only factor here, there is also time. maybe those people could buy phones every 3-4 years instead of a year?

            2. people dont deem anything. thats whats lost on a bunch of you. economy deems. current business model of android oems is unsustainable in the 5 years timeframe, let alone in the long run…

            3. what are samsung and apple doing right now? and why isnt micromax doing the same thing in india?

            4. so they buy feature phones. i cant afford a car, does that mean car manufacturers should work at a loss? or i should make peace with the fact i cant have a car and buy a bike? whats up with this socialism on the android platform?

            5. PC hardware manufacturers, desktop and laptops

            6. not really. ecosystem = software, hardware, services, consumers. 4 factors

            7. what? because they are limited by their means? i want you to buy me a bmw now.

  • Teddy Beyrouthy

    Android is beeing a chineese os wich makes it lose its value and coolnes infront of ios … Returne android to 4 manufacters: sony lg samsung and htc and all will go well because other companies like xiomi huawei … Will be obliged to use unliked os like oxygene or windows and will fail to have positive viewpoints on their profucts!!!

    • Christopher

      I’m sorry, isn’t Oxygen OS based on android?

      • Teddy Beyrouthy

        Yes and here must begin google’s role in making this os a sucsessfull os but less premiem as android os and give it to chineese manufacters i mean come on a hight end phone for 300$ it simply deosn’t feel premium for people and for u example: when u are using a sony z3+ of course u will have a better premiem look of a huawei or xiomi phone

  • Belinda M

    Yes Offer Of The Day by authority . < Start Work Online

  • Alex

    This 92% claim is simply wrong. You even explained it yourself in the article. Where is Googles share in this graph? Add that and Apple makes half or less.

    • abazigal

      They are looking solely at hardware profits alone. Google technically sells phones as well, but that breaks even at best. So Google is a non factor in this discussion.

      • Alex

        It is stated nowhere that this is hardware only plus its also very unlikely.

        • Chris Garcia

          Yes it does.. because Apple, HTC, Samsung, LG ..(and the 5 others ones they mentions ) are hardware makers.. whole point of the article.. and again. Google isn’t a hardware maker.. Motorola and LG have made their phones.. (and its a small margin anyway)..

    • bob

      actually, apple is massive comparing to google, specifically 3 times as big

      http://www.statista.com/statistics/234529/comparison-of-apple-and-google-revenues/

      while apple is growing and google plateauing, failing to find a new moneymaker besides its desktop ads business (mobile ads not doing so good)

      it makes virtually nothing from android, its just a way to present ads. not very successful considering facebook is killing them in mobile ads

      they should really start thinking beyond ads

    • Chris Garcia

      Googles phones are made by other people.. (Motorola, LG etc.).. and Motorola and LG aren’t making money with smartphones.. Its not about how many sold. its about how much of the profits for that industry.. Apple has 92% of the profits..

    • Google makes very little on Android and actually makes more on iOS than Android even after TAC.

  • bob

    actually, apple S upgrades are more substantial than number upgrades, usually carrying massive upgrades to camera, processor package and other internals such as radios etc.. Look at 5->5s: 100% improvement to cpu + 64bit, touch id, massive camera improvement

    this year 6->6s, massive camera improvement, probably 100% improvement in cpu because of 14nm and the addition of the third core, massive gpu upgrade, force touch – new basic UI element which could be huge to the overall UI interaction on iOS devices.

    think intel tick tock

    in my opinion thats the best approach, not changing the design every year, instead improving upon. also, you dont alienate people on 2year contracts, they still have latest model in terms of looks, along with the latest software. a concept android oems dont really believe in.

    think mercedes, bmw: new model, 4 years after a slight facelift with new engines, electronics, 3-4 years after a new model comes.

    its called respecting the buyers

    • Dan Sims

      Apple is also the king of planned obsolescence so even if you plan on keeping the same iPhone for up to four years and saving money. Apple will automatically update the OS thus decreasing internet speed, battery power, and making your year old iPhone almost unbearable to use.

      • Karly Johnston

        so don’t update it.

      • Then don’t update the OS.

        • Dan Sims

          Apple automatically updates its smartphones with minor upgrades to the OS just like Google updates it’s software every few weeks or so. Planned Obsolescence effects your smartphone even if you don’t download the latest iOS because the updates from Apple are designed to run on the new OS. It’s not the big giant iOS 8-9 leap that’ll get you but the tiny updates here there that’ll slow down your device.

      • Scr-U-gle

        Look at Androids update policy as published on Googles T&Cs for it, ‘No updates after 18 months’.

        So you can keep your iPhone up to date for at least five years, or you can get an Andi that doesn’t get support for the length of a carriers contract.

        Or shall we talk about the thousands of devices that will not get a patch for Stagefright Gate?

        Planned obsolescence is Android, how long did Google Wallet last before that became obsolete?

  • abazigal

    Weird. For a moment, I thought I had stumbled onto Appleinsider by mistake. :p

    • Chris Garcia

      Sorry about facts..

  • AnakiMana

    Well that sucks it’s not profitable. But nearly everyone I know who has an Android phone loves it. I think the Note 4 is superior in almost every way to the iPhone. My first Samsung phone, except for the Galaxy Nexus.

    • bob

      why arent costumers buying them then?

      • it’s me tim-cock.

        Because of that cult like mentality that apple have created for it’s sheep. Monkey see, monkey do.

        • bob

          there must be a lot of rich monkeys in the high end segment then, because nobodys buying high end android smartphones

          • Patrick Smithopolis

            You don’t have to be rich to get an iPhone. All you need is to get a contract or payment plan. I see lots of poor people with iPhones.

          • How do you define “Poor”?

          • Chris Garcia

            You do understand there is a world besides the United States right? What you consider “poor” in the USA.. is RICH for most countries.. Smartphones are only growing in “developing” nations.. They can’t pay more then $100 for a phone… and often pay $40-$50.. There is no “contracts”..

          • Alex

            Oh there are millions them! I personally know dozens. Enough money to buy high end phones but ingnorant illiterates when it comes to the most basic technology. Gotta admit Appple serves them well.

          • Dan Sims

            Rich monkeys prefer Apple products for the same reason they typically buy organic food because it’s not filled with unnecessary crap. Can anyone tell me where to find an Android device that doesn’t have Google bloat pre-installed in it? I don’t need Playstore as there’s a lot of alternative app markets that are just as good or better.

          • natsumero

            Google bloat? You’re really concerned with the playstore being on there? I’m sure most people, probably over 95%, will use the playstore and google services. It’s the manufacturer crap I’d say is bloatware. Coming from someone who usually uses custom rom, the playstore should definitely be on any android phone by default, if anything should be.

        • Sherpa

          So ironic that you don’t see that you have fell for the “cult-like mentality that Android has created for it’s fandroids.” Let people use what they prefer rather than calling names.

          • Dan Sims

            Android only gives you the illusion of choice when in fact you’re buying the same OS in a different body. Google is basically the Wal-Mart of the smartphone industry, sure it’s cheap but at a cost.

      • AnakiMana

        Who said customers aren’t buying them? Apple just makes more profit while Android phones aren’t marked up as much. That’s what my understanding was anyway. Someone correct me if I’m wrong.

        • bob

          high end android phones (600+$) arent selling well, thats why average selling price for android is so low, hence the profit is so low

          in other words, android phones are 150$ vs iphones 600+ bucks. imagine the brand damage

          • AnakiMana

            I started on Android phones with the cheap stuff from a few generations ago, and it was awful (Virgin Mobile selection sucks too) – but I recognized that it was the hardware that sucked and I liked Android and the ecosystem. I moved up to a Nexus 5, then again to a Note 4. Both those choices proved to me that Android is great on good hardware. I wouldn’t want to change ecosystems or be limited in the ways Apple forces you to in terms of lack of customization, ROMs, storage, batteries, etc. Otherwise I know Apple makes a sturdy and good performing device that people generally like.

        • Ken

          The only reason that Android has 50% of the market share in the U’S. is because of cheapskates that buy sub $100 phones and don’t understand why they don’t like the iPhones or Galaxy phones. People that are willing to buy a decent phone buy iPhones. 2/3 of the Android handsets that are bought are sub $150 POS that come in blister packs.

      • Chris Garcia

        They are buying them.. 82% market share buying them. lol.. Its just a majority of that 82% is low margin phones.. that is why no/low profits..

        • bob

          we’re talking about high end phones here, the ones that matter

          • Chris Garcia

            That is why I said.. The majority of whats sold is low end/low margin phones.. Samsung/LG/Motorola/Hauwei and others do still sell a decent amount of high-end phones.. just nothing like Apple does. Apple grabbed that market .. and really has held onto it for several years now. Not sure if it will change.. I think especially with iOS 9 being about improvements on slower hardware, and being able to fit better on 16GB. I think Apple still might have plan to hit that lower end market that the iPhone 5C really didn’t do.. That could be a tipping point back in Apple’s marketshare favor.

  • JasperAkSarawak

    All the apple fan boys will rejoice at the news, not realizing that it is their money that apple is taking, lol

    • bob

      they are not taking, we’re paying. now the question you should be asking is why android users arent paying? obviously it isnt worth to them. i wouldnt want costumers like that, nor be a part of that kind of ecosystem

    • Sherpa

      Off-contract prices (AT&T):

      Samsung Galaxy S6 (64GB): $784.99
      Samsung Galaxy S6 edge (64GB): $914.99
      LG G4 (32GB): $629.99
      Nexus 6 (32GB): $699.99
      HTC One M9 (32GB): $708.99

      iPhone 6 (64GB): $749.99

      Tell me, oh wise one, how is Apple the only one “taking” money from their customers?

      • AnakiMana

        I think you’re missing the point. Of those dollar amounts you listed, how much is profit over the cost of building, etc? Apple makes a higher percentage of profit per sale, I think. Or did I read that wrong?

        • bob

          bill of materials for s6 and i6 is similar, so i imagine the profit margin is somewhat similar. but the s6 doesnt come close to iphone numbers. also, majority of samsung phones are budget phones, hence very low ASP of phones for samsung. why do they even compete at the low end?

          • Chris Garcia

            And.. Samsung makes several of the parts in iPhones.. so Samsung has the savings as they produce their parts instead of paying 3rd parties..

        • Sherpa

          Then why can’t other manufacturers find a way to have higher margin on profit? What are they missing? Samsung can build everything on their own then why haven’t they found a way to have higher profit margin?

        • Chris Garcia

          I would think Samsung would have the leg up on cost of build.. Since they build MUCH of what is in their phones.. and SELL Apple parts.. so .. not good logic.

          • Darktanone

            Also, because of Apple’s tremendous buying power, they’re able to negotiate and lock in cost for future products at today’s prices. This is a big advantage over their competitors. Android as a platform has the market share advantage, but Apple’s share as an individual manufacturer gives them the advantage over any individual Android partner. The sheer volume of iPhones and iPads sold each year enable them to negotiate deals that the competition can’t match. Keeping their cost down and margins high.

          • Chris Garcia

            Except Samsung doesn’t have to negotiate with anyone. They build most of their own parts. The parts Apple has to buy from others.

    • abazigal

      Not really. I know that it is my money, which I gladly give to Apple in exchange for access to the ecosystem that only Apple can provide.

  • mrochester

    I think the really interesting question is, what are these Android OEMs going to do about their disastrous profits? After all, making money is the number one reason to be in business so if you’re not making money, you’ve failed as a business. I’d be really interested to know what their strategy is for reversing this trend and whether it is a realistic strategy that might actually work.

  • Mark Kendrick

    Android has some amazing phones and dominates the smartphone market share but worldwide the majority are low end phones with little OEM profit. Apple dominates the high end market with is more profitable.

  • MDMcAtee

    The problem is the carriers in the USA. IF the big 4 players in Android said no to exclusive deals, and structured the cost of the phones to them as Apple does ,the profits would be taken back.

  • Pez Nospam

    I was in a phone shop about an hour ago and the sale assistant was showing a couple in 70s a Samsung phone. They listen to the assistant and then they just said they preferred the iPhone because all their friends have iPhones.

    It’s quite difficult to go against something like that for Android phone makers. You would have to sell about 100 Android phone just to break even against 1 iPhone.

    • Ken

      I work at the Connection Center at Wal-Mart and customers who understand quality and user experience always go for iPhones. Nearly every person that comes back to the store with issues with their handsets has an Android phone. And 90% of those are sub $150 LG,ZTE,Huwai handsets. They can’t access their data connection, they don’t have enough tech savvy to mine the phones menu to nice photos from the phone to SD or their pc. Customers that are willing to pay a reasonable amount for a good handset nearly always choose iPhones. For everyone else they buy the ultra cheap sub $150 phones and get angry at us when they don’t work. You get what you pay for.

      • Pez Nospam

        That couple were shown the Galaxy S6 but they still prefer the iPhone because their friends have them. They admitted to knowing very little about phone techs. They did say that they wanted to synch with their friends… I have no idea what they meant by that. I know they have money & not spending it on Android phones. :-)

    • Karly Johnston

      that is a lazy sales rep, the usual pitch for iPhone… simple and just works.

  • HotelQuebec

    I love paying more for less. Thank you Apple.

  • hoggleboggle

    Another utterly idiotic study by some moron of an analyst cherry picking data to suit a nice headline grabbing title.

    • bob

      cherry picking? you know they are talking about profit here? the sole reason of existence of mobile phones in the first place?

  • Patrick Smithopolis

    As mentioned in the article the problem for these large Android manufacturers is that for less than half the price of their flagship phone you can get a decent alternative. The gap between low end and high end is closing and that doesn’t bode well for manufacturers like Samsung and LG.

  • Sherpa

    I use both, a Note 4 and an iPhone 6 Plus, but, I hate it when people just out-right blame Apple that they charge more for their devices and make more profit. Before you accuse them of this, please look at these prices:

    Off-contract prices (AT&T):

    Samsung Galaxy S6 (64GB): $784.99
    Samsung Galaxy S6 edge (64GB): $914.99
    LG G4 (32GB): $629.99
    Nexus 6 (32GB): $699.99
    HTC One M9 (32GB): $708.99

    iPhone 6 (64GB): $749.99

    • AnakiMana

      What about some prices on non-high-end Android phones? Like the middle of the road priced phones? What’s the least expensive current-gen iPhone cost compared to the cheapest good-quality/performance mid-range Android phone? I think there’s a lot of folks who don’t care to have the BEST at a premium, but want a good phone at medium price point.

      • Sherpa

        My point is, Android manufacturers have the same opportunity as Apple to make more profit by charging more, yet, they are unable to. Majority of people still go for big brands like Samsung, LG, and HTC. They couldn’t care less about brands like Huwaei or Meizu, etc.

        • mrochester

          This. Android OEMs would charge more if they could get away with it. The fact that they can’t indicates that the value proposition of their products is lower than that of their main competitor. They aren’t charging you less than what it would cost to get an iPhone just because they are nice, they are charging you less because you won’t pay any more.

    • John Doe

      It’s not the customer prices, it’s the markup …
      Give us the manufactures cost, and then the customer price. Only then will we see the true
      difference between Android and Apple phones (if any)..
      I doubt you have those prices, but it would be kool to know what they are ..
      You would think that Samsung would have lower overhead, as they make most of their own
      technology, while Apple has to purchase most of theirs ..

    • Timothy Anderson

      The profit comes from a high price, as associated with the cheap cost to make the device. If your product does not cost much to make and you charge a premium for it, you make a high profit. It’s that simple. Also, it has to do with how much research and spending you do. If you don’t make many changes and keep with the same basic design for hardware and software, you can maintain your profit.

      • Sherpa

        Samsung makes almost all of their parts but they are not seeing the same profit. Explain that! They even build parts for Apple.

        • Timothy Anderson

          The parts are superior and more expensive. Samsung also spends more on R&D and advertising which adds to cost.

          • Sherpa

            Oh ok. I guess Apple spends no money on R&D and advertising. Makes sense.

  • s2weden2000

    and still does not help “the fact” …

    • bob

      the fact the android is collapsing in both profitability and brand?

      • s2weden2000

        keep milking…

  • Siralf

    OH GOD! 92% of profits?! That’s… that’s… mean

  • David

    Sometimes a rip-off can beat the original at its own game, but not this time. The Android is nothing but a third-rate imitation of an iPhone. It doesn’t have the apps, it doesn’t have the compatibility or the versatility, it doesn’t have much of anything–as the numbers show.

  • Eccentric Nafi

    well i used iphone 6 plus as well as nexus 6(i prefer vanilla android over gimmick).Iphone 6 is a handicapped phone but gives out a steady service that nexus 6 fails to deliver.With 3 gb ram n6 is a kick ass device but often apps crrashes in lollipop and it stutters here and there.Most people dont care about,processor,ram,gpu and benchmarks.They want a stable and decent phone,and no android can ensure that.

    ps im an android fan.my daily driver is n6 and n9

  • John Doe

    Is it my misunderstanding or do the numbers on the graph = 110% lol

    • Karly Johnston

      the other 10% is loss = 100%. it was explained already.

  • Awayze

    People will pay more for a better experience. I have a Z3 and a N7 2013, sister has a i6. The i6 is a bit faster, rotation from portrait to landscape is instant on iOS, going back to home screen, multitasking screen, opening apps etc all are quicker. There’s usually a delay on Android. Not to mention the better app selection, even Google’s own apps are smoother on ios. After my Z3 contract ends, 95% chance I’ll go with a iPhone.

    • theemptyhead

      Wait, wait !! Did you just said multitasking in iphone?

    • John Doe

      Yay …

  • 404

    Apple has always been the fashion brand, the mainstream brand, the self-esteem booster brand. That’s what makes it so popular.

  • abazigal

    I personally feel that people who argue that Apple earns so much because they use cheap parts are missing the point. When I buy an iphone, I am not so much paying a premium for anaemic specs like 1gb of ram, or a 720p display, or a 8mp camera, as I am paying for Apple’s expertise in putting all these together into an integrated package that offers a unique user experience which simply can’t be replicated by the competition.

    In this context, I don’t care even if the iphone I buy at $650 costs only $1 or even 1 cent to make (hypothetically speaking). How much Apple earns out of their products is immaterial to me. What matters more is the value I am getting from their product, and if Apple is able to give me a great user experience, I won’t begrudge them their profits.

    Could their products be cheaper? Possibly. Does this make Apple products overpriced? I guess the question then is – overpriced relative to what?

  • true_statistics

    Statistics: 92% people are idiots, 15% people have taste for phones but too much money, “essentially irrelevant” people% are smart people…

    yea, I would say thats true…

    • true_statistics

      befor some smartass comments on 92%,15% like thats over 100% it can not be true… those are profit/loss statistics… so if you have for example 3 brands, 1 of them has + balance, one of them has 0 balance and one – balance they share the 100%
      Positive exm. A has 80% share
      Neutral exm. B has 0% share
      Negative exm. C has -20% share
      —————————————–
      Together 100%

      Thanks for nothing, cheers!

  • metronome

    iPhone have 90% of all the profits because they’re the only ones making an actual profit fullstop….
    When you consider you can either buy a 16GB Nexus for $300 or for the same money you can get a 64GB!
    http://digital-wear.com/the-best-android-tablet-2015-284/

  • David Stinnett

    All iOS phones are Apple. Anybody can sell an Android phone. Of course you can’t make as much competing with all the other Android phone makers. I like Google and Android, but it is what it is. It’s not about Apple’s prices–my phone was $649. Apple can do what they want. If their customers like it, great. Not my choice, but so what.

  • Peter Ward

    All these figures prove is that Apple products are overpriced and that there is no shortage of fanboys happy to keep shelling out for them. Once again Apple’s marketing (not products) leaves everybody else standing.