Apple’s iPhone X captured 35pc of global smartphone profits in Q4

18 Apr 2018

The Apple iPhone X. Image: Halfpoint/Shutterstock

Apple’s latest smartphone is performing better financially than hundreds of rival Android devices.

Apple’s iPhone X smartphone, which was unveiled in September last year, is hugely profitable and accounted for 35pc of total smartphone industry profits in Q4 2017.

According to new figures from Counterpoint, the iPhone X generated five times more profit than the combined profit of more than 600 Android original equipment manufacturers (OEMs) during the quarter.

This is considerable when you realise that the device was only available for purchase in the last two months of the year. It also possibly trumps speculation that indicated that sales of the device were lacklustre.

Smartphones are now the primary computing devices on Earth, according to the IMF, and we may have reached peak smartphone. Except for Apple, which is still bucking trends.

Older Apple devices more profitable than bulk of smartphone industry

Apple’s iPhone X generated 35pc of global smartphone profits in Q4

Source: Counterpoint

According to the latest research from Counterpoint, in Q4 2017, global handset profits declined 1pc year on year as the premium smartphone market did not grow as expected.

Counterpoint believes that the global smartphone market has already reached its peak, with longer replacement cycles and key smartphone OEMs now under pressure to book profits.

“Global handset profits declined 1pc year on year, but Apple grew 1pc year on year even with the iPhone X being available for only two months in Q4 2017,” Counterpoint research analyst Karn Chauhan said.

“The iPhone X alone generated 21pc of total industry revenue and 35pc of total industry profits during the quarter, and its share is likely to grow as it advances further into its life cycle.

“Additionally, the longer shelf life of all iPhones ensured that Apple still has eight out of top 10 smartphones, including its three-year-old models, generating the most profits compared to current competing smartphones from other OEMs,” Chauhan said.

According to Counterpoint, Apple remained the most profitable brand, capturing 86pc of the total handset market profits. Further splitting profits by model, the top 10 models nabbed 90pc of the total handset profits for the world.

Apple and Samsung flagship models lead in terms of profits when compared to other OEMs.

Apple’s older-generation iPhones – iPhone 7 and iPhone 6 – still generate more profit than some of the more recent Android flagships from key Chinese OEMs. Huawei was the leading brand among all the Chinese brands, with profit increasing 59pc year on year.

“Chinese OEMs cumulative profits crossed $1.3bn during Q4 2017,” said Counterpoint associate director Tarun Pathak.

“This was driven by the increased mix of mid- to high-end smartphones.

“In fact, the average selling price of their flagship devices also increased year on year. Key Chinese players like Huawei, Oppo and Vivo are now looking to scale up the price band by leveraging their in-house manufacturing capabilities and bringing innovation to their devices.”

The Apple iPhone X. Image: Halfpoint/Shutterstock

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years