It looks like Apple will not be the only company making a tidy profit from the new iPhone X. If Apple sells a lot of the handsets, then Samsung could also make a substantial amount of money from the device.
Samsung is the sole supplier of the OLED display used in Apple’s new iPhone X, and the company is reported to make around $110 for each display used in Apple’s new iPhone.
The news comes in a report from the Wall Street Journal and Counterpoint Technology, and the report estimates that Apple will sell 130 million iPhone X handsets by the summer of 2019. Samsung will earn $110 for each one of these handsets sold.
The Financial Impact on Samsung
This partnership between Apple and Samsung is a fascinating example of how competitors can also be business partners. Despite being fierce rivals in the smartphone market, the two companies have found a way to benefit mutually. For Samsung, the financial impact is significant. If Apple meets its sales projections, Samsung stands to make approximately $14.3 billion from the OLED displays alone. This revenue is a substantial boost for Samsung’s display division and highlights the importance of their role in the supply chain.
Samsung’s expertise in OLED technology has positioned them as a critical supplier for Apple. OLED displays are known for their superior color accuracy, brightness, and energy efficiency compared to traditional LCD screens. This technological edge has allowed Samsung to command a premium price for their displays, contributing to their profitability.
Apple’s Strategy and Market Expectations
For Apple, the iPhone X represents a significant shift in their product lineup. The introduction of OLED displays, facial recognition technology, and a nearly bezel-less design marks a new era for the iPhone. These features are expected to drive strong consumer demand, particularly among early adopters and tech enthusiasts.
Apple will start taking pre-orders for the iPhone X later this month on the 27th of October, with the handset going on sale on the 3rd of November. The anticipation surrounding the release is palpable, with many analysts predicting that the iPhone X will be one of Apple’s best-selling models.
However, the success of the iPhone X is not just about the hardware. Apple’s ecosystem, including iOS, the App Store, and various services like iCloud and Apple Music, plays a crucial role in retaining customers and encouraging them to upgrade to the latest models. The seamless integration of hardware and software is a key differentiator for Apple and a significant factor in their continued success.
Broader Implications for the Industry
The collaboration between Apple and Samsung also has broader implications for the tech industry. It underscores the complexity of global supply chains and the interdependence of major tech companies. While they compete fiercely in the consumer market, they also rely on each other for critical components and technologies.
This dynamic can lead to interesting market behaviors. For example, if Samsung’s OLED displays are in high demand, it could impact the availability and pricing of these components for other manufacturers. Smaller companies that also rely on Samsung for OLED displays might face supply constraints or higher costs, affecting their ability to compete.
The launch of the iPhone X is a significant event not just for Apple, but for Samsung and the broader tech industry as well. The financial benefits for Samsung highlight the interconnected nature of the tech ecosystem, where competition and collaboration often go hand in hand. As consumers eagerly await the release of the iPhone X, both Apple and Samsung are poised to reap substantial rewards.
Source, iDB
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