Apple captured 103.6% of smartphone industry profits in the third quarter of 2016, making it by far the most profitable company in the business, according to BMO Capital Markets analyst Tim Long. This represents a notable increase from the year-ago quarter where Apple had grabbed 90% of smartphones profits.
This share of the profits is even more amazing considering iOS share of global smartphone shipments clocked at 12.1% for Q3, compared to 13.6% in the year-ago quarter.
How can Apple get over 100% of the profits, you may ask? It’s simply that many smartphone makers actually lose money in the business. Any net loss from other vendors results in Apple being able to grab more profits than the global industry netted overall.
Samsung comes at number 2 with a 0.9% share of smartphone profits despite having a market share almost twice that of Apple’s. Of course, Samsung profits took a hit following the Note 7 debacle, and this is expected to have more negative impact going forward.
Apple historically never fought for market shares, instead focusing on profits. This was true for its personal computer business 15 years ago, and it is still true today with its smartphone business. Apple shows once again that market shares don’t mean much and the real bottom line is how much money you bring home at the end of the day.