VodkaPundit

Singing the Samsung Blues

(Shutterstock photo)

(Shutterstock photo)

It wasn’t that long ago — 2012 — that the South Korean electronics giant commanded half of all profits in the smartphone market. Then its share dropped to a third. Now Samsung earns only 15%, according to figures from Canaccord Genuity and reported by the Wall Street Journal:

Samsung, which for a time found success making smartphones in all price tiers, is suffering in the now-crowded industry. Last week, the company said it expects profits to decline for a seventh straight quarter in the three months ended in June. Samsung appears to have misjudged demand for its newest phones, ordering too many Galaxy S6 phones and not enough of its higher-priced curved-screen cousin.

The results demonstrate the rapidly shifting fortunes in the smartphone business, which Apple transformed with the iPhone in 2007. At that time, Finland’s Nokia was grabbing about two-thirds of smartphone-industry profits, Canaccord estimates.

By the end of the decade, Apple and BlackBerry Ltd. joined Nokia in the top tier. By 2012, Apple and Samsung essentially split industry profits 50-50. Now, Apple stands far above the others. “That high-end tier has really shifted away from Samsung to Apple,” said Mr. Walkley.

Apple took 92% of the profits last quarter, and if you’re wondering how 92 + 15 = 100, every other smartphone maker lost money — a figure which is included in the total anyway.

So if you want the “real,” percentages, Apple’s and Samsung’s were both somewhat lower than Canaccord Genuity figures them.