With 17.6% of sales, Apple took 92% of smartphone profits

But only if you forget the companies that don’t report their profits.

Of all the analysts who cover Apple, Canaccord Genuity’s T. Michael Walkley is the only one I know who tracks smartphone profits—or tries to.

In a note to clients Tuesday Walkley reported—with a big caveat—that Apple’s share of smartphone profits in the December quarter was an impressive 92%, down from an even more impressive September. (See Apple takes 106% of smartphone profits.)

The caveat is that Walkley’s profit numbers don’t include the big Chinese makers—red hot companies like Oppo and Vivo—whose government doesn’t require them to report profits. The absence of that data is especially striking in the interactive chart below.

Not seeing the nifty interactive graphic? Try the website. 

Walkley ends on an upbeat:

While we anticipate a stronger upgrade cycle in [calendar] 2018 with the 10-year anniversary iPhone
8, our surveys indicate solid iPhone 7 demand that should bridge the gap until a new form factor iPhone is likely released in September. We anticipate steady iPhone 7 sales through the 1H/C’17.

Reiterate buy rating and raise price target to $154 from $142. 

UPDATE: To give you a feel for what those Chinese companies represent, here’s a chart created by Quartz’s Asia correspondent from the latest IDC data:

2 Comments

  1. Fred Stein said:
    Where is Pixel? Is it included in HTC’s .7% market share?

    0
    February 7, 2017
  2. Gregg Thurman said:
    Better question: Where is Samsung?

    On a side note: It’s no wonder the Chinese government doesn’t require reporting profits. Between 1949 and 1999 profits reported In the People’s Republic of China largely depended on the honesty of those reporting results. While the “accounting” environment has improved greatly in the last 20 years there remains much room for improvement.

    0
    February 8, 2017

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