Samsung to make more profits from Apple iPhone X than its own Galaxy S8
Apple and Samsung have a long history of bitter legal battles but at the same time key partnerships for various products. The two companies, however, are betting big on the iPhone X.
Samsung may be the ultimate winner if Apple's bet on the ultra-premium smartphone, the iPhone X, pays off. In fact, Samsung can make more money off Apple than its own flagship smartphone the Galaxy S8, reports The Wall Street Journal.
According to the report, Samsung is expected to make $110 on each unit of the iPhone X, which is priced at $999, roughly ₹65,600. That's almost 10% of the total market price of the iPhone X. It is worth noting that the iPhone X is also the most expensive iPhone ever Apple has launched. Apple is estimated to sell a whopping 130 million units of the iPhone X in the next two years.
Samsung provides OLED panels, NAND flash and DRAM chip to Apple. Samsung is also believed to be the only supplier that can deliver that kind of bulk order for these components. The WSJ report states that the order is now driving Samsung's components business, which accounts for roughly 35% of the company's revenue. The Korean company is expected to rake in $14 billion in profits from the iPhone X, which is higher than the estimate of $10 billion from the Galaxy S8 during the same period. ALSO READ: Highlights: Apple launches iPhone X with Face ID, wireless charging
It's highly unlikely that Apple will continue to show this much of affection for Samsung, which is its closest competitor in the smartphone market. At some point, Apple will be looking for other suppliers, and rumours suggest the company may go ahead with LG in 2019. Moreover, other component players will also be upscaling their capabilities to match Apple's demands. Samsung's main advantage has been that it is the only company to keep up with the amount of components required by Apple.
That being said, Apple and Samsung have had a bittersweet relationship over the years. The two companies were locked in a series of lawsuits over smartphone patents for several years, famously known as "smartphone patent wars." The two companies fought lawsuits in courts in South Korea, Japan, France, Australia, Germany and the US.