Samsung Expected to Earn $4B More Making iPhone X Parts Than Galaxy S8 Parts

Samsung looks on course to earn around $4 billion more in revenue making parts for the iPhone X than from the parts it makes for its own flagship Galaxy S8 handset, according to new research revealed on Monday.

An analysis conducted by Counterpoint Technology for The Wall Street Journal based its prediction on projected sales in the 20 months after the new iPhones go on sale November 3. According to CounterPoint, the reason for the chosen time window is that the majority of sales for a new smartphone typically occur in the first 20 months after its debut.

Counterpoint expects Apple will sell 130 million iPhone X units, earning Samsung $110 on each through the summer of 2019, while Galaxy S8's global sales are expected to be 50 million, earning Samsung $202 each from components such as displays and chips in its first 20 months of sales, according to estimates based on a projected bill of materials. The Counterpoint analysis includes parts sales from Samsung Electronics plus two Samsung affiliates that make batteries and capacitors.

Apple and Samsung are expected to be the world's two most profitable companies in 2017, excluding Chinese banks, according to S&P Global Market Intelligence. Samsung's components operation stands to make billions of dollars supplying the OLED screens and NAND flash memory chips for the new iPhone. Meanwhile, Apple hopes its new iPhone 8 and iPhone X range will boost its smartphone sales, which accounted for two-thirds of the company's $215.64 billion revenue in fiscal 2016, according to investment bank CLSA.

WSJ reports that Apple and Samsung's close association can be traced back more than a decade to when Lee Jae-yong — the grandson of Samsung's founder — personally negotiated with Apple co-founder Steve Jobs to provide flash memory for iPods, according to people familiar with the matter.

That enduring relationship has strengthened in recent months, but mostly out of pure necessity. Samsung is one of only a small number of semiconductor makers that can make large amounts of NAND flash memory, and remains the only significant manufacturer of the OLED displays adopted by Apple for the iPhone X, tightening the dependence of the two companies on each other.

At meetings, Samsung executives are known to tell attendees who pull out iPhones: "It's OK. They're our best client," according to people familiar with the matter.

Samsung employees often refer to Apple with code names. One of the most popular is "LO," short for "Lovely Opponent," people familiar with the matter said. Apple's descriptor for Samsung, meanwhile, is Samsung, according to people with knowledge of the situation. Employees at the iPhone maker are often critical of its rival's devices, pointing out software and hardware flaws behind closed doors.

The business relationship, however, hasn't been without its ups and downs. In 2011, Apple sued Samsung over alleged patent infringement of its smartphones, leading Samsung to counter-sue with its own infringement allegations. Steve Jobs famously called the dispute – which remains unresolved to this day – a "thermonuclear" legal war.

KGI Securities analyst Ming-Chi Kuo has claimed OLED iPhone panel supply is "controlled wholly by Samsung", which may have contributed to the $999 iPhone X's high price. In a bid to reduce its dependency on Samsung parts going forward, Apple has recently encouraged OLED production by rival suppliers like Sharp and Japan Display, while also pursuing alternative sources of NAND flash, most recently by agreeing with Bain Capital and others to acquire Toshiba's chip plant in a deal reportedly worth $17.7 billion.

Tags: Samsung, OLED

Top Rated Comments

(View all)
Avatar
33 months ago

Samsung can’t use Apple’s screen technology on their phone, this is very teasing.

What screen technology?

Samsung phones have had OLED displays for many years!

Lets compare:

iPhone x - 2436x1125 (458 PPI)
Galaxy S8 - 2960x1440 (570 PPI)
Galaxy S8+ - 2960x1440 (529PPI)
Score: 18 Votes (Like | Disagree)
Avatar
33 months ago

The OLED used by iPhone X is the true tone OLED with 3D Touch technology, which is totally different from Samsung’s OLED used in their phones.

Marketing department has earned it's paycheck.:p:D The only things missing in your comment are Bionic, Super Retina, and Animoji. Oh, and facts. The comment is definitely missing those.:rolleyes:
Score: 14 Votes (Like | Disagree)
Avatar
33 months ago
The irony here is epic .
Score: 10 Votes (Like | Disagree)
Avatar
33 months ago

So basically some so-called research firm pulled numbers out of their rear end that would be good for clicks.

Analyst firms don't just "pull numbers out of their rear end", otherwise they wouldn't stay in business for years.

Moreover, Apple themselves often quote numbers from analysts (when they're favorable).

The OLED used by iPhone X is the true tone OLED with 3D Touch technology, which is totally different from Samsung’s OLED used in their phones.

True tone is about adjusting the white balance, not a difference in the display itself. That's why it's doable on both LCD and OLED devices.

3D Touch

Likewise, 3D Touch is done via a flexible glass overlay, not a difference in the display itself. That's why it's doable on both LCD and OLED devices.
Score: 9 Votes (Like | Disagree)
Avatar
33 months ago

What screen technology?

Samsung phones have had OLED displays for many years!

Lets compare:

iPhone x - 2436x1125 (458 PPI)
Galaxy S8 - 2960x1440 (570 PPI)
Galaxy S8+ - 2960x1440 (529PPI)

Article is bias'ed as heck. As you pointed out, why would Samsung WANT to use Apple's implementation of Samsung's SCREEN technology. It's ridiculous to even claim it' Apple's "screen technology" when they are using someone else's displays. All Apple is doing is applying their own settings. That's not proprietary "screen technology." You can argue they have proprietary SOFTWARE that's driving the screen resolution.
Score: 9 Votes (Like | Disagree)
Avatar
33 months ago
Damn that iPhone looks so much better than the galaxy, which pretty much looks like every buttonless smart phone.

Gladly embrassing iPhones new style.
Score: 7 Votes (Like | Disagree)

Top Stories

Leaker Claims New 13-inch MacBook Pro Coming as Soon as Next Month

Monday April 6, 2020 2:56 am PDT by Tim Hardwick
Apple will announce a new 13-inch MacBook Pro in May with the codename J223, according to a rumor shared by YouTuber and leaker Jon Prosser. Note: it’s a refresh to the current 13” So the bigger 14” display upgrade is a big possibility— Jon Prosser (@jon_prosser) April 4, 2020 Analyst Ming-Chi Kuo has said Apple plans to release new MacBook Pro and MacBook Air models with scissor keyboards ...

iOS 14 Could Offer Home Screen Widgets, Wallpaper Customizations

Saturday April 4, 2020 3:30 pm PDT by Frank McShan
iOS 14 could offer home screen widgets and wallpaper customizations for the first time, according to 9to5Mac and Twitter user DongleBookPro. Apple is reportedly working to implement widgets that can be moved freely around like icons on the iPhone and iPad homescreen for the very first time. The feature is reportedly codenamed "Avocado" and no other details are available. It was also...

'Leaked' Images Allegedly Show iPhone 12 With Smaller Notch, Rear Camera Redesign, and Home Screen Widgets

Tuesday April 7, 2020 4:28 am PDT by Tim Hardwick
Two images shared on social media this morning are currently stoking speculation about possible hardware redesigns coming to the iPhone 12 and the potential introduction of Home screen widgets in iOS 14. Shared by Twitter user Fudge (choco_bit), the images depict a front and rear graphical representation of a smartphone with interface elements on the screen, suggesting it came out of a...

More References to Apple's Upcoming Low-Cost iPhone Appear Online

Monday April 6, 2020 4:38 am PDT by Tim Hardwick
Further references to Apple's upcoming low-cost iPhone have appeared online, one on a Chinese e-commerce website and another on Verizon's smartphone trade-in page. Spotted by tech blog MySmartPrice, Chinese retailer JD.com has published a placeholder for Apple's so-called "iPhone 9" that includes a teaser image of a veiled smartphone, but other than that it lacks any particularly revealing...

The New York Times, IFTTT, Medium, and Other Apps Adopt Sign in With Apple Ahead of June 30 Deadline

Sunday April 5, 2020 7:08 pm PDT by Frank McShan
Apps with sign-in functionality, including The New York Times, IFTTT, Medium, and more, have continued to adopt Apple's secure Sign in with Apple feature ahead of a deadline of June 30. The deadline for these apps to support the feature was recently extended from April 30. Sign in with Apple, first introduced in iOS 13, allows users to create accounts for apps and websites using an Apple ID. ...

Some Users Experiencing System Crashes on macOS 10.15.4, Especially During Large File Transfers

Monday April 6, 2020 8:17 am PDT by Joe Rossignol
A sizeable number of Mac users are experiencing occasional system crashes after updating to macOS Catalina version 10.15.4, released a few weeks ago. The crashing issue appears to be most prominent when users attempt to make large file transfers. In a forum post, SoftRAID described the issue as a bug and said that it is working with Apple engineers on a fix for macOS 10.15.5, or a...

Apple Releases iOS and iPadOS 13.4.1 With Fix for FaceTime Bug

Tuesday April 7, 2020 10:06 am PDT by Juli Clover
Apple today released iOS and iPadOS 13.4.1, minor updates that come two weeks after the release of iOS and iPadOS 13.4, major updates that introduced iCloud Folder Sharing, a new Mail toolbar, trackpad support for the iPad, and more. The iOS and ‌iPadOS‌ 13.4.1 updates are available on all eligible devices over-the-air in the Settings app. To access the updates, go to Settings > General...

Top Stories: Apple Leaks iPhone SE and AirTags, Apple Buys Dark Sky, and More

Saturday April 4, 2020 6:00 am PDT by MacRumors Staff
With the calendar rolling over to April this week, we yet again saw several leaks and rumors, most notably including Apple itself leaking some references to a pair of long-rumored products: a new budget iPhone SE and AirTags item trackers. Subscribe to the MacRumors YouTube channel for more videos. Apple also acquired popular weather app Dark Sky, while Amazon's Prime Video app now allows...

Apple Reportedly Targeting WWDC for Over-Ear Headphones Launch, New 'AirPods X' Later in the Year

Tuesday April 7, 2020 7:00 am PDT by Eric Slivka
Rumors of Apple-branded over-ear headphones have been circulating for quite some time, while more recent rumors have mentioned an "AirPods Pro Lite" that could also be in the works, and Twitter leaker Jon Prosser's recent foray into Apple rumors provides a bit more detail on what we might able to expect for these products. Current Beats Studio3 Wireless and BeatsX On the over-ear side,...

Apple Donating Over 20 Million Masks to Healthcare Professionals, Producing Face Shields With Suppliers

Sunday April 5, 2020 2:51 pm PDT by Joe Rossignol
Apple CEO Tim Cook today shared a video message with an update on the company's response to the ongoing pandemic. Cook said Apple has now sourced over 20 million masks that it is in the process of donating to healthcare professionals around the world. Apple is working with governments to ensure that the masks are donated to the places of greatest need. Cook added that Apple's design,...