The World’s Most Profitable Tech Company? Not Apple
경제문화 Economy, Culture/News for Foreigner2017. 7. 8. 18:31
The World’s Most Profitable Tech Company? Not Apple
By Jacky Wong
Updated July 6, 2017 11:30 p.m. ET
Samsung Electronics likely edged past Apple to become the world’s most profitable technology company last quarter. But to continue the strong run, it may hope the iPhone maker does better as well.
The South Korean tech giant said Friday it expects its operating profit for the quarter ended June to be a record 14 trillion won ($12.1 billion)—a 72% jump from a year earlier. On the other hand, Apple will likely report an operating profit of $10.6 billion for its latest quarter when it announces results next month, according to estimates from S&P Global Market Intelligence.
By Jacky Wong
Updated July 6, 2017 11:30 p.m. ET
Samsung Electronics likely edged past Apple to become the world’s most profitable technology company last quarter. But to continue the strong run, it may hope the iPhone maker does better as well.
The South Korean tech giant said Friday it expects its operating profit for the quarter ended June to be a record 14 trillion won ($12.1 billion)—a 72% jump from a year earlier. On the other hand, Apple will likely report an operating profit of $10.6 billion for its latest quarter when it announces results next month, according to estimates from S&P Global Market Intelligence.
Rising memory chip prices, driven by strong demand from servers and mobile, have likely contributed to Samsung’s strong results—the company hasn’t provided many details at this point. About 60% of its operating profit comes from the semiconductor business, according to Morgan Stanley. The March launch of its new flagship phone, the Galaxy S8, has also helped. Apple, on the other hand, continues to see slowing iPhone sales.
Still, strong sales of the newest iPhone model, expected later this year, could actually benefit Samsung. The Korean company will supply flexible displays, called organic light-emitting diodes, to at least one version of the new phone, The Wall Street Journal has reported. Samsung currently owns nearly the whole market for mobile OLEDs. Apple probably wants to source from other suppliers—like Korea’s LG Display—as well, but supply from such companies won’t likely come until late next year.
Even though Samsung supplies memory chips to Apple as well, the business accounts for less than 5% of the company’s operating profit, Credit Suisse estimated. The more salient impact from the so-called iPhone “supercycle,” as some analysts call it, is that it will likely keep memory chip prices buoyant.
While Samsung and Apple are sometimes depicted as arch rivals, their relationship is actually one of mutual benefit right now.
https://www.wsj.com/amp/articles/the-worlds-most-profitable-tech-company-not-apple-1499398067
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