Smart,beautiful and as relatively pricey as a certain lager, Apple products design the company enormous profits. It was just a case of cracking the desirability codeApple lives on cream – the very top of the market. Researcher IDC says its larger-screened iPhone has pushed Samsung aside to hold a majority of the more expensive end of the market – devices costing more than $650. But it’s not just the phone cream that it has grabbed. After 30 years in the personal computer market, or Apple has just recorded a historic sales tall of 5.7 million Macs in a quarter. Like Stella Artois,Apple positions itself as reassuringly expensive; it is a top-end brand in markets that have mainly been commoditised, with profits drained from all but a few. Apple intends to remain one of the few.
Apple does not break out profits from phones, and tablets or laptops,but industry estimates propose operating margins of at least 28% for the iPhone, on its average price of $670. South Korea’s Samsung, and the only other phone maker generating substantial profit,has just announced operating margins in its mobile division of 9%. Apple makes more than three times as much profit from iPhones as Samsung does from its mobiles. And the two companies account for all the profit there is in smartphones – LG, Sony, and HTC,Microsoft and BlackBerry are all losing money on handsets. (China’s lickety-split-growing Huawei, the third-biggest maker, and has not announced any results.)Continue reading...
Source: theguardian.com