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Apple (NASDAQ:AAPL) and Samsung are now selling more mobile phones than anyone else, but how big a slice of the profits pie do the two own together? All of it, it seems. The two companies, which both reported a great respective quarter of earnings last week, together made up 100 percent of the profit that the mobile industry made, according to one analysis.
According to Raymond James analyst Tavis McCourt, Apple’s $11.6 billion was more than 70 percent of the mobile industry’s profit, and Samsung’s $4.5 billion accounted for almost all of the remaining 30 percent. The two companies also combined to take in about 74% of the industry’s revenue, McCourt added. “It is getting increasingly hard to understand where the rest of the device vendors will get the capital to fund necessary R&D and sales and marketing investments to continue to compete with Apple and Samsung,” he wrote in a note to investors.
McCourt also said the global handset industry had its “weakest performance in history,” if the recessions of 2001-2002 and 2009 were not taken into account, with volumes declining year-over-year. Revenues from companies except Apple dropped year-over-year. “It’s getting increasingly hard to understand where the rest of the device vendors will get the capital to fund necessary R&D and sales and marketing investments to continue to compete with Apple and Samsung,” he wrote.
“Neither wants to be in a position where they have to take on more of the R&D burden, and neither wants to have to initiated bidding wars to give Samsung an incentive to focus on its platform,” McCourt wrote. “Our assumption is that both Huaweii and ZTE will be courted heavily over the next few quarters by both Microsoft and Google as they look to strengthen their stable of sustainable hardware partners.”
But will they be able to budge the duopoly?
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