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Convenient narrative, but it's likely that this has more to do with their component business (nand, DRAM, LCDs, etc.) than their smartphone business. Samsung ov

Convenient narrative, but it's likely that this has more to do with their component business (nand, DRAM, LCDs, etc.) than their smartphone business. Samsung overproduced a bunch of memory just as demand fell through the floor. [1] Also, your article on Apple's smartphone profit share is from April 2018, so more like 2017 than 2018. Not sure how relevant that is to 2019 earnings. [1] https://www.wsj.com/articles/samsung-hopes-strong-chip-sales-arent-just-a-memory-11554459899 https://www.wsj.com/articles/samsung-hopes-strong-chip-sales...

ehsankia 8y ago
What about the fact that the Chinese manufacturers are taking over the Asian and European market, over Samsung and Apple who are both losing market share? They might not be making as much money, as they run much tighter profit markets, but they are basically taking over the market by undercutting the competition.
- sanxiyn 8y ago
  I think that narrative is roughly correct, but I think it doesn't affect profit of neither Samsung nor Apple in the short term. Who knows about long term.
- evancox100 8y ago
  What about it? I'm sure that could also be affecting their earnings, we'll have to wait for the earnings report to find out the extent of it. But the current analysis and reporting right now points to major issues in the component side of the business. Also, remember that Samsung is still selling these components to Huawei, Oppo, etc., so it's not a total loss when they take market share.
  - sanxiyn 8y ago
    On the other hand, Samsung's smartphone market share is pretty important for its nascent non-memory component business, because Huawei won't use Exynos, neither AP nor 4G and 5G modem.
    - tooltalk 8y ago
      >On the other hand, Samsung's smartphone market share is pretty important for its nascent non-memory component business, ... not sure why that matters? the nascent non-memory component business is not the major cost-center, or money-maker for the company. Samsung's doesn't always use internal parts in their products -- take for instance, Sharp, which had been Samsung's LCD panel supplier until Foxconn took over. There are also rumors that some lower end Samsung smartphone use displays made by BOE.
- tooltalk 8y ago
  >What about the fact that the Chinese manufacturers are taking over the Asian and European market Two independent industries. Those Chinese manufacturers still have to use memory products made by either Samsung, Hynix or Micron. It does not matter which smartphone OEMs make more profit or has greater marketshare. Those three DRAM makers combined account for 90% of global DRAM supplies. China is not going to have its own domestic (major) DRAM manufacturer anytime soon.
tooltalk 8y ago
Absolutely I agree that AppleInsider's nonsensical fanboi narrative has no place. This is all part of business cycle that went a bit berserk in 2016 when Samsung decided to increase their capex significantly to boost their capacity to capture greater marketshare in spite of the obvious resulting glut. Yes, consumers benefitted from plummeting prices, but most DRAM makers had to cut capex and capacity to deal with the DRAM glut and plummeting prices in 2016. The lower capex and capacity likewise eventually led to the price hike of 2017-2018 that we just witnessed. During this rise, the DRAM market participants again started expanding and we are seeing prices falling again. Barring unseen major technical breakthrough or extraordinary market demand (no, I don't mean Apple's market share or profit margin, fanbois), this cycle would continue...

ehsankia 8y ago

What about the fact that the Chinese manufacturers are taking over the Asian and European market, over Samsung and Apple who are both losing market share? They might not be making as much money, as they run much tighter profit markets, but they are basically taking over the market by undercutting the competition.

sanxiyn 8y ago
I think that narrative is roughly correct, but I think it doesn't affect profit of neither Samsung nor Apple in the short term. Who knows about long term.
evancox100 8y ago
What about it? I'm sure that could also be affecting their earnings, we'll have to wait for the earnings report to find out the extent of it. But the current analysis and reporting right now points to major issues in the component side of the business. Also, remember that Samsung is still selling these components to Huawei, Oppo, etc., so it's not a total loss when they take market share.
- sanxiyn 8y ago
  On the other hand, Samsung's smartphone market share is pretty important for its nascent non-memory component business, because Huawei won't use Exynos, neither AP nor 4G and 5G modem.
  - tooltalk 8y ago
    >On the other hand, Samsung's smartphone market share is pretty important for its nascent non-memory component business, ... not sure why that matters? the nascent non-memory component business is not the major cost-center, or money-maker for the company. Samsung's doesn't always use internal parts in their products -- take for instance, Sharp, which had been Samsung's LCD panel supplier until Foxconn took over. There are also rumors that some lower end Samsung smartphone use displays made by BOE.
tooltalk 8y ago
>What about the fact that the Chinese manufacturers are taking over the Asian and European market Two independent industries. Those Chinese manufacturers still have to use memory products made by either Samsung, Hynix or Micron. It does not matter which smartphone OEMs make more profit or has greater marketshare. Those three DRAM makers combined account for 90% of global DRAM supplies. China is not going to have its own domestic (major) DRAM manufacturer anytime soon.

tooltalk 8y ago

Absolutely I agree that AppleInsider's nonsensical fanboi narrative has no place. This is all part of business cycle that went a bit berserk in 2016 when Samsung decided to increase their capex significantly to boost their capacity to capture greater marketshare in spite of the obvious resulting glut. Yes, consumers benefitted from plummeting prices, but most DRAM makers had to cut capex and capacity to deal with the DRAM glut and plummeting prices in 2016. The lower capex and capacity likewise eventually led to the price hike of 2017-2018 that we just witnessed. During this rise, the DRAM market participants again started expanding and we are seeing prices falling again. Barring unseen major technical breakthrough or extraordinary market demand (no, I don't mean Apple's market share or profit margin, fanbois), this cycle would continue...