The California company made an estimated $3.2bn (£2.1bn) profit from iPhone sales in the second quarter of the year, according to the research firm Strategy Analytics, a marked drop from $4.6bn a year ago and less than Samsung’s estimated $5.2bn haul from both its basic models and smartphones in the same period.
While the high-priced iPhone was the engine that propelled Apple to become the world’s most valuable company, its customers are no longer bent on owning the latest model.
Healthy demand for the three-year-old iPhone 4, which is cheaper than the latest iPhone 5, has reduced the average selling price of its blockbuster device.
As smartphone ownership trickles down the income brackets in both western and emerging markets, Apple’s margins have taken a hit. The company’s latest financial results showed that the average selling price of an iPhone has fallen to $581, down from $613 in the first quarter.
The same trend has squeezed Samsung’s handset profits, which are down from an estimated $5.6bn in the second quarter of 2012, but the strong performance of its flagship Galaxy S4 has, at least for now, put an end to Apple’s four-year reign as the world’s most profitable phone-maker. Read More