Those from CNN they made a comparison between the number of terminals produced by Apple and the profit collected from their sale, and the results are downright shocking because Apple produces only 2.8% of the terminals sold globally, but collects 39% of the profit collected at the global level global. Yesterday, Apple recorded the best stock market quote in its entire history, its shares having the highest price ever recorded in the company's history, and of course Apple was yesterday the "richest" company in the USA. A large part of this success is due to the sales of mobile terminals, Apple managing to sell 17 million mobile terminals in the first half of this year, unlike Nokia, Samsung and LG who sold 400 million. Considering that these 3 companies sold more than 20 times more terminals than Apple, you would have expected that the profit would be proportional to the sales, right? Well NO! Apple collected 39% of the global profit for mobile terminal sales, while Nokia, Samsung and LG together recorded only 32% of the global profit for mobile terminal sales.
We are also impressed with Apple's ability to monetize its innovative products through selling high-margin consumer products that drive strong earnings results and growth trends for Apple shareholders. A case in point is the mobile phone market, where most handset OEMs struggle to post a profit or even 10% operating margins (except RIM and recently HTC), while we estimate Apple boasts roughly 50% gross margin and 30%+ operating margin for its iPhone products.
In fact, Nokia, Samsung and LG combined sold roughly 400M mobile handsets worldwide in the first half of 2010 with a combined value share of 32% of handset industry profits, while Apple sold roughly 17M units over the same time period and captured an estimated 39 % of industry profits, or greater than the top three global handset OEMs combined. Apple leads the industry in every metric except for unit share...
Apple really knows how to profit from the success of iPhone terminals and imposes its own conditions when signing contracts with mobile operators so that Apple gets a more than good profit from its terminals. Unfortunately, the rest of the producers cannot afford to do the same because they would be left without a market and prefer to obtain a lower profit and sell more.
My opinion is that at this rate Apple will end up imposing increasingly strict conditions and probably at some point a break will be created somewhere, even if its terminals will be in "high demand".
