Apple may get the last laugh this month as its iPhone 6 launches alongside Samsung’s Note 4. Having held on to a solid market share for the last few years, Samsung’s earnings are falling rapidly.
Samsung has warned that its third-quarter earnings were worse than expected, with revenues falling by 2015 per cent and profits would drop 59.8 per cent. Previous estimates from analysts expected a profit of $5.2 billion, but Samsung is projecting a profit of only $3.8 billion. It appears Samsung is headed for its first annual earnings drop since 2011.
This will be good news for Apple, who previously launched a litigation war against its rival, claiming that Samsung had copied some of its smartphone and tablet designs. While the lawsuit failed to change much, Samsung seems to be failing on its own.
China is a huge market for both companies. Unfortunately for Samsung, lower-cost Chinese rivals are taking the lion’s share of its sales. On the other hand, pre-orders of the iPhone 6 area taking massive leaps – on Saturday, 2 million were ordered between 7am and 2pm, bringing the total to 4.85 million.
Apple seems to be winning in wearables too, as everyone has forgotten about Samsung even though the Apple Watch won’t be released until next year. Perhaps the furore around mobile payments has helped. Despite recent privacy problems – the celebrity iCloud hacking has not helped its image – Apple seems to be the one mobile provider trusted to provide payments. Trust seems to be back, as its stock rises.
After the long awaited announcement of Apple Pay, Samsung needs to make some major changes in order to right itself. Right now, the market share is squarely back in Apple hands.
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