As far as high-end smartphones are concerned, Samsung could be having its cake and eating it too.
Each time Apple sells a brand new iPhone X, it means one fewer customer for Samsung’s own range of high-end phones. But Samsung likely isn’t overly worried — it ends up making $110 off the sale of every new iPhone X anyway.
Samsung provides many of the underlying electronic components for the iPhoneX, including the NAND flash, the DRAM chip, and even the curved AMOLED display. Samsung is among the very few companies in the world that can produce components in the volumes that Apple needs, and Apple turns to it, even though they’re bitter rivals. The $110 figure is the result of an analysis done by Counterpoint Research and published in the Wall Street Journal, and comprises component sales from Samsung Electronics, in addition to two Samsung affiliate companies producing batteries and capacitors, based on estimates from a “projected bill of materials.”
Incredibly, the amount Samsung stands to make from the sales of the iPhone X could be more than the money it’ll make from the sales of its own flagship Galaxy S8. Samsung is expected to make $14.3 billion (Rs. 93,000 crore) from the sales of the iPhone X. In comparison, it’ll only make $10 billion (Rs. 65,000 crore) from the sales of the Galaxy S8.
It’s a very unique business relationship for these two giants to be in. They’re clearly no fans of each other — Apple and Samsung have sued each other on numerous occasions, and have won settlements of hundreds and millions of dollars. Samsung also regularly trolls Apple’s iPhone launches, once creating a Google ad that showed results for its S6 phones when users searched for iPhone 6S, and at another time creating a series of ads called “It Doesn’t Take A Genius,” mocking Apple’s Genius Bars. But business is business — Apple needs Samsung to provide many components it can’t make at scale, and Samsung clearly needs Apple too — it’s making the company more money than its own flagship phone. And until Apple manages to beef up its own manufacturing capacity, this strange interplay between the two biggest phone companies in the world is expected to continue.