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BDSwiss | October 19, 2017

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Apple - Highly profitable - BDSwiss

Apple – Highly profitable

The California IT company Apple is highly profitable. In the third quarter, the Group secured more than 90 percent of the total profit in the smartphone market. The ability to maximize prices and minimize costs is unique in the world.

Apple and the iPhone

Apple focuses on a few products and promotes them in a very big way. The iPhone has long been technically lacking. It has long been as vulnerable to viruses and other malicious software as competing products with Android operating system. However, Apple is more than just a brand, Apple is THE BRAND in the smartphone area.

The market for smart phonesapple-bdswiss-small

The entire market for smart mobile phones has earned $ 9.4 billion in profit in the third quarter of this year. Of this, 91 percent was generated by the California-based company Apple. But why is that? On the one hand, Apple have built up a highly profitable company through clever marketing and the focus on individual models. Their competition has significantly larger and thus more expensive product pallets. On the other hand, Samsung falls out of the equation this quarter. Although it sold significantly more smartphones than Apple, Samsung was forced to contend with the recall of one of their flagship products. The problems with the Galaxy Note has hurt the Asians’ balance statement last quarter.

Restrained euphoria at Apple

Apple is of course happy to be so profitable. However, the strategy of concentration on marketing and sales is coming at the expense of innovation. Apple has been regarded as technologically lacking for years now. It just seems to be a matter of time before a competing company brings an optically similar appealing smartphone onto the market and knows how to market it. Therefore, it can be assumed that the fluctuation margin of the Apple share price could continue to grow. Here, of course, it is necessary to act on short-term trends.

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