Ben Schoon, 9to5Google:
In March, a report revealed some of the internal cuts
Samsung has been making for its mobile division, with the company
initially concerned it could post an operating loss for the first
time ever. It’s a big deal, as Samsung’s mobile (MX) division has
historically always turned a profit.A new report out of Korea (via Jukan) makes this
seem all but certain.Apparently, Samsung’s TM Roh, the head of the company’s mobile
division, has expressed concerns of the “possibility of an annual
deficit for the MX business unit.” Previously, those concerns came
from speculation and outside parties, but with such a high figure
in Samsung’s organization worried, it’s clear things are looking
pretty bleak.
Back in 2013 analysts pegged the profit share of the handset industry at 70 percent for Apple and 30 percent for Samsung. A lot of other smaller companies sold a lot of other phones, but, so that analysis went, none of them made any profits. A lot of them were losing money. I linked to another such analysis in 2016 that pegged Apple’s share of phone profits at 104 percent, estimating that all other handset makers combined accounted for a 4% percent loss.
Doesn’t seem like much has changed since then. I prompted ChatGPT and Gemini today with this request: “Create a table of the world’s mobile device makers, ranked by profit and profit share of the industry.” ChatGPT pegs Apple’s profit share at 75–85%, Samsung’s at 10–20%, Huawei and Xiaomi in “low single digits”, and everyone else negligible. Gemini pegs Apple’s share at 85–90%, Samsung’s at 7–10%, Xiaomi at 1-2%, and everyone else negligible. This, despite both ChatGPT and Gemini agreeing that iPhones comprise only 20 percent of sales by unit.
If Samsung posts a mobile division loss this year, it could be the case that Apple will capture 100 percent of the profits in the phone industry with just 20 percent of the sales.
