LG's smartphone exit: who stands to gain?

LG Electronics' move to exit its loss-making mobile business is expected to create more opportunities for Samsung than its other rivals in the lucrative North American smartphone market, analysts said.

LG's US market share currently stands at about 10 percent, research firms Gartner and Counterpoint estimated, adding it was stronger in markets where it partnered with telecom companies to include its devices as part of a mobile plan.

"Apple tends to cater to the higher end of the (US) market; so it might grab a small portion of LG's sales," Gartner analyst Tuong Nguyen said. "It's more likely that Samsung inherits a lot of it because both vendors compete across similar markets."

Globally, LG's market share shrank to 2 percent in 2020, a massive drop from its status as the world's third-largest smartphone maker behind Samsung Electronics and Apple Inc during its peak in 2013.

The company shipped 23 million phones last year, compared with Samsung's 256 million, according to Counterpoint.

Counterpoint analyst Tarun Pathak said LG was mostly competing in the mid-tier, as its flagship phones received tepid market response.

"So it will be mostly the Chinese and mid-tier brands benefiting through the LG exit. In its key market like USA – Samsung, Motorola, HMD mostly (ZTE, Alcatel to a lesser extent) will benefit, while Xiaomi, Motorola will benefit in LATAM and Samsung in Korea," Pathak added.

Tech enthusiasts on Twitter lamented the exit of the once ubiquitous name in the smartphone industry, with many crediting LG for pioneering the now-familiar features such as ultra-wide angle camera and capacitive touchscreen in mobile devices.

"They didn't always ace every phone, but losing them means losing a competitor that was willing to try new things, even when they didn't work," popular YouTuber Marques Brownlee (@MKBHD) said in a tweet.

-reuters-

Apple's pricey iPhone X, subscriptions deliver earnings beat

Apple Inc sales led by the pricey iPhone X pushed quarterly results far beyond Wall Street targets on Tuesday, with subscriptions from App Store, Apple Music and iCloud services bolstering business.

Apple also forecast revenue above expectations for the fall, when it typically launches new iPhone models, reassuring a nervous tech sector that saw sell-offs last week in Facebook Inc , Twitter Inc and Netflix Inc on concerns about their future growth. Apple also regained growth in China, where sales rose 19 percent.

Apple has responded to a plateauing global smartphone market by launching ever-more expensive phones and diversifying into services. Chief Executive Tim Cook credited "wearables", a category which includes wireless earphones and the Apple Watch, with making growing contributions as well.

And Apple has used its pile of cash to buttress share prices, buying back $20 billion in stock in the quarter, part of a $100 billion stock buyback program.

"The lesson Apple’s management has learned from the iPhone X, is when you sell a smartphone for more than $1,000 you can sell fewer units and still reap the financial benefits," said analyst Thomas Forte from D.A. Davidson & Co.

Shares rose 3.4 percent to $196.80 in after-hours trade. With a market capitalization of more than $900 billion, Apple is tickling at the title of world's first trillion-dollar company.

Apple sold 41.3 million iPhones in the fiscal third quarter, below expectations of 41.8 million units, but the average iPhone selling price hit $724, beating analyst expectations of $694, according to data from FactSet. Apple Chief Financial Officer Luca Maestri told Reuters that customers were buying costlier models and the $999 iPhone X was the quarter's best seller.

Apple posted third-quarter revenue of $53.3 billion and profits of $2.34 per share, compared with analyst estimates of $52.3 billion and $2.18 per share, respectively, according to Thomson Reuters I/B/E/S.

The world's most valuable technology company also forecast revenue of $60 billion to $62 billion for its fiscal fourth quarter, which will include early sales of soon-to-be-announced phone models, beating the $59.6 billion analysts expected, according to data from Thomson Reuters I/B/E/S.

Despite the beat, James Cordwell, an analyst from Atlantic Equities, said the high selling prices might cause investors some concern because "there’s a limit to how much Apple can grow the iPhone franchise by pushing pricing."

Apple services include streaming music and video, where Apple faces competition from rivals including Spotify Technology SA and Netflix.

But several of Apple's services do not face strong rivals. Maestri told Reuters that sales from Apple Care, the company's warranty offering, were up 27 percent versus a year ago, though the company did not disclose a dollar figure for sales.

Apple's biggest selling products do not yet face duties stemming from the US-China trade disputes, but President Donald Trump has threatened hundreds of billions of further tariffs whose product categories have not yet been enumerated.

Apple is looking at whether it will be hit by tariffs on purchases the company must make, possibly "related to data centers," Cook said on a conference call with investors.

Another category potentially affected by tariffs is the Apple Watch, which is one of Apple's growth drivers. Maestri told Reuters that the company's so-called "wearables" business - which includes the Apple Watch and its AirPods headphones, among other items - has generated $10 billion in sales in the past 10 quarters and saw sales increase 60 percent in the most recent quarter.

"We are not able to catch up to demand yet and continue to add capacity for the AirPods," Maestri said.

Apple's margins are facing pressure as it moves to put pricier components, such as OLED displays that show more vivid colors, into its products. The company said it expects gross margins of 38 percent to 38.5 percent in the fourth quarter, compared with analyst expectations of 38.3 percent, according to Thomson Reuters I/B/E/S. Analysts are also closely watching Apple's operating expenses, which have been increasing as its research and development costs outpace its revenue growth.

Services revenue was $9.5 billion, beating analyst expectations of $9.1 billion, according to Thomson Reuters I/B/E/S. The revenue included $236 million from resolving lawsuits such as Apple's long-running dispute with Samsung Electronics Co Ltd.

Apple said it expects operating expenses of $7.95 billion to $8.05 billion in the fourth quarter, compared with analyst estimates of $7.8 billion, according to Thomson Reuters I/B/E/S.

source: news.abs-cbn.com

Apple reports blockbuster quarter as iPhone sales top estimates

Shares of the world's most valuable listed company were up 2.6 percent at $124.50 in after-hours trading on Tuesday.

Apple sold 78.29 million iPhones in the first quarter ended Dec. 31, up from 74.78 million last year, marking the first quarterly growth in iPhone sales in a year.

Analysts on average had estimated iPhone sales of 77.42 million, according to research firm FactSet StreetAccount.

The results, which reflected the first full quarter of iPhone 7 sales, come at a time when global demand for smartphones is slowing and cheaper Android alternatives are flooding the market.

Revenue in the Greater China region fell 11.6 percent to $16.23 billion, highlighting Apple's struggles in a hotly contested smartphone market.

The company also forecast revenue of between $51.5 billion and $53.5 billion for the current quarter. Analysts, on average, had expected revenue of $53.79 billion, according to Thomson Reuters I/B/E/S.

Apple Chief Financial Officer Luca Maestri said that a stronger dollar hurt the company's revenue forecast.

Analysts on average expect the company to sell 53.43 million iPhones in the current quarter, according to FactSet.

The company is heavily dependent on the success of iPhones, which account for 69.4 percent of its total revenue.

Analysts and investors have already set their sights on Apple's 10th-anniversary iPhone, which is expected to feature better touchscreen technology, wireless charging and a shift to OLED display.

Apple's services business - which includes the App Store, Apple Pay and iCloud - recorded a 18.4 percent growth in revenue to $7.17 billion, helped by the popularity of games, including Pokemon Go and Super Mario Run, and increased revenue from subscriptions.

Cowen & Co. and Mizuho Securities had expected revenue of about $7 billion, while FactSet had forecast $6.91 billion.

Analysts expect growing revenue from Apple's services segment to help offset declining hardware sales as the smart phone market matures.

The company's net income fell to $17.89 billion, or $3.36 per share, in the quarter from $18.36 billion, or $3.28 per share a year earlier. Analysts on average had expected $3.12 per share.

Revenue rose 3.3 percent to $78.35 billion in the quarter.

Analysts had expected revenue of $77.25 billion, according to Thomson Reuters I/B/E/S.

Up to Tuesday's close, Apple's shares have gained 14.7 percent since mid-November, compared with the 5.3 percent rise in the Dow Jones Industrial Average.

source: news.abs-cbn.com

Android gets record 87.5 pct of smartphone market: survey

WASHINGTON - Google's Android operating system captured a record-high 87.5 percent of the global smartphone market in the third quarter, a research firm said.

The survey released Wednesday by Strategy Analytics found Android's share increase from 84.1 percent in the same period a year ago, while Apple's iOS saw its share slip to 12.1 percent from 13.6 percent.

"Android's leadership of the global smartphone market looks unassailable at the moment," said Strategy Analytics' Woody Oh.

"Its low-cost services and user-friendly software remain attractive to hardware makers, operators and consumers worldwide."

Oh added that the dominance of Android poses challenges for Google, which offers the system for free to manufacturers.

"The Android platform is getting overcrowded with hundreds of manufacturers, few Android device vendors make profits, and Google's new Pixel range is attacking its own hardware partners that made Android popular in the first place," he said.

The report said global smartphone shipments grew six percent from a year ago to 375.4 million in the quarter, the fastest growth rate for a year.

According to the survey, the market share for other operating systems including Windows and BlackBerry fell to a minuscule 0.3 percent from 2.3 percent last year.

"BlackBerry and Microsoft Windows Phone have all but disappeared due to strategic shifts, while (Samsung's) Tizen and other emerging platforms softened as a result of limited product portfolios and modest developer support," said Neil Mawston, executive director of the research firm.

source: www.abs-cbnnews.com

Apple hits milestone: 1 billion iPhones sold

SAN FRANCISCO - Apple announced Wednesday the sale of its billionth iPhone, a milestone for the company as it seeks to keep momentum in a competitive smartphone market.

Chief executive Tim Cook made the announcement at a staff meeting at the company's California headquarters.

"IPhone has become one of the most important, world-changing and successful products in history," he said in a statement.

"It's become more than a constant companion. IPhone is truly an essential part of our daily life and enables much of what we do throughout the day. Last week we passed another major milestone when we sold the billionth iPhone. We never set out to make the most, but we've always set out to make the best products that make a difference."

The news comes a day after Apple reported a drop in iPhone sales over the past quarter, a second straight drop after uninterrupted growth since its introduction in 2007.

Apple sold 40.4 million iPhones in the quarter ending June 25, down 15 percent from a year earlier, highlighting concerns over growth for the iconic smartphone.

The quarterly results underscored the challenges for Apple, which has built a huge business around the iPhone but is unlikely to see continued growth, due to a saturated smartphone market and increased competition.

Apple has been seeking to diversify its product line and move into services for a more stable revenue base, while keeping users in its ecosystem with offerings such as music, connected cars and its Apple Watch.

source: www.abs-cbnnews.com

How Lenovo's Motorola is planning to compete in China

BEIJING - Motorola, the mobile handset maker bought by China's Lenovo Group Ltd from Google Inc for $2.9 billion, is optimistic about its prospects in the Chinese market, its president told Reuters.

Lenovo's acquisition, completed three months ago, ended Google's move into the consumer mobile handset business. The deal has turned personal computer-maker Lenovo into a challenger in the higher-end smartphone market, competing with Samsung Electronics and Apple In.

"The (Chinese) market itself is so big here and Motorola has no share today, so we believe that what we’re really going to succeed in doing is hopefully take some share from other people in the market," Rick Osterloh, President of Motorola Mobility told Reuters.

Motorola will compete in China with Apple and Samsung in the premium smartphone market and with the world's third biggest smartphone maker Xiaomi Inc in mid- and mid-high level phones. Lenovo is already the number two smartphone maker in China.

"Our approach is to have global products tailored and customised for local markets," Motorola's Osterloh said. Motorola will also stick to relatively high-end products, he said.

Bryan Ma, a Singapore-based analyst at tech research firm IDC, said Motorola might test the waters with smartphones designed for the Americas, but in the next 12-24 months they could announce more localised products.

"They're trying to introduce themselves to a new group of friends and trying to establish street cred," Ma said. "What they have in their pockets is assets from the U.S."

"The good thing is Lenovo has enough of a strong cash position and local channel presence that they can bankroll Motorola in the country for while," Ma said.

source: www.abs-cbnnews.com

Growing PH smartphone market fuels mobile advertising

MANILA, Philippines – There have been much talk about the promise of mobile advertising in recent years and industry leaders believe that the Philippine advertising landscape is now on its way to experiencing a “seismic change.”

Ernest Cu, CEO and President of Globe Telecoms, said the change in the advertising industry landscape is being ushered by the growing access of more Filipinos to cheaper yet still powerful smartphones.

He said these smartphones, given their capabilities, can now accommodate media heavy advertisement formats such as the popular “augmented reality.”

“Mobile bears tremendous opportunity from the perspective of preferred advertising media. Most importantly, because it is so personal, it enables a unique efficiency of reaching out to very precise target markets,” Cu told the attendees of the 2012 Mobile Marketing Congress on Thursday.

Cu, citing latest data from renowned research firm GFK, said 1 out 3 mobile phones in the Philippines is a smartphone. He said about 95% of Globe’s 150,000 new post-paid subscribers quarterly are choosing smartphones.

He also noted the wider reach of mobile phones, with some 80 million Filipinos owning it as opposed to some 14 million households with television.

“Thus, as far as reach and pervasiveness go, for the advertising community, there would appear to be more fish to catch in the cellular area than in broadcast,” he said.

Anand Tilak, Regional Manager for Agency Business and Sales Development of Google Southeast Asia, also shared Cu’s observation about the Filipinos’ shifting attention towards mobile media and away from traditional ones.

Tilak said a study revealed that two-thirds of Filipinos sitting in front of TVs are not engaged in watching but are surfing the Internet instead.

“Consumers are in love with mobile. People look at their mobile phones more frequently in a day than they look at their spouses,” he said.

Industry trends are also showing that the world is indeed going mobile, and companies of varying sizes have started funneling part of their budgets to mobile advertising.

According to Joerg Krahnert, managing director of leading mobile platform service provider Netbiscuits, the following are the five key trends in web development indicating the migration from the traditional PCs to mobile.
- mobile users will surpass desktop users globally by 2014;
- web will be accessed through mobile four times than via PCs by 2015
- 81% browse the Internet on smartphones today
- 50% of today’s native apps will be web or hybrid (HTML 5) by 2015
- four times faster growth of enterprise spending on cloud services than overall IT

TARGETING CONSUMERS

One of the advantages of mobile advertising is its capability to reach its target audience, as opposed to the “shot gun approach” of the traditional media.

Cu said currently Globe has some 2 million out of its 30 million subscribers who have opted in to be profiled. This means they can share data, with the subscriber’s permission, to third parties for marketing purposes.

“The infrastructure and intelligence behind such capabilities are what empower the M-ads proposition… We are building that capability extensively - profile the customer almost in real time so we can track demographics, usage, product subscriptions, transactions and interactions, bill payment and behavior,” he said.

“Whereas the oldest system take from 15 to 45 days to render useable customer profile information, Globe will do it within a day. If we are able to direct and time our advertisements and message precisely, then that’s relevant. M-ads make most sense when they can be pointed on select markets based on customer profiling parameters.”

Globe currently has a partnership with leading mobile advertising firm Out There Media for its opt-in mobile advertising. Subscribers who agreed to be profiled receive rewards.

“People who opt in to our program actually earn points. This is Globe reward points that you can change to services. In doing so, as they give us info they would earn points,” he said.

Cu said customer profiling for mobile advertising is still facing challenges in the Philippines, with verifying customer information still difficult due to the lack of a national identification system database.

source: abs-cbnnews.com

Nokia clings onto cash despite big loss

HELSINKI — Ailing mobile maker Nokia turned in another thumping loss on Thursday, as it tries to arrest a decline towards irrelevance in a smartphone market dominated by Apple’s iPhone and Samsung’s Galaxy models.

The company, which has been burning through money at a rate that would clean it out in a couple of years, managed, however, to cling on to more of its cash reserves in the second quarter than the market had feared, giving its battered shares an 18 percent boost.

The shares had fallen around 80 percent since February 2011 when the company announced its shift to the largely untried Microsoft Windows phone operating system.

Sales of its new Lumia phones, which run the Microsoft software, doubled from a low base in the previous quarter, but have yet to grab share back from Apple and Samsung Electronics in the most profitable part of the mobile market.

Nokia reported a second-quarter net loss of 1.53 billion euros, or 8 euro cents a share when adjusted for one-off items, compared with the market’s average forecast for a loss of 9 euro cents a share. It held net cash of 4.2 billion euros ($5.2 billion), compared with the market estimate of 3.7 billion, but still down from 4.9 billion at the end of the first quarter.

The company’s shares were up 15 percent at 1.576 euros at 1157 GMT, having touched 1.621 euros.

Details showed that advance royalty payments of 400 million euros accounted for most of the lower fall in its cash position.

“It’s partly the advanced royalties. Nevertheless, it was a positive move by management to calm down the market,” said Juha Varis, who holds Nokia shares as part of the Danske Invest Finnish Equity Fund.

But Varis said he was worried Nokia had placed all its bets on Windows Phone, which wasn’t yet showing it could help reverse Nokia’s fortunes.

THIRD-QUARTER WARNING

Nokia sold 4 million Windows phones in the second quarter, still only a fraction of Apple’s expected sales of 30 million iPhones or Samsung’s 50 million smartphones.

“I think currently the company is too dependent on Microsoft,” Varis said. “What happens if this marriage ends? We would prefer to have a second option to Windows.”

Nokia forecast its third-quarter loss in the phone business would be just as steep as the second at minus 9.1 percent, an outlook that was worse than analysts had expected.

“The third quarter is going to be the most difficult quarter for Nokia,” said J.P. Morgan analyst Sandeep Deshpande.

“I don’t think there’s anything fundamentally fixed, and a guide of minus 9 percent again in D&S (Devices and Services) came as a bit of a shock to us. So I’m perplexed by the strength of the (market) reaction,” said Lee Simpson, analyst at Jefferies & Co.

In the three months to June, all three major credit ratings agencies have cut Nokia bonds to “junk”, while the company warned twice on profits and said it planned to cut one in five jobs.

source: interaksyon.com

PH leads smartphone adoption in SEA, thanks to low-priced Androids

MANILA, Philippines — The Philippines is once again proving its dominance in the mobile space as the local smartphone market boasted the highest growth rate in Southeast Asia for the first quarter of 2012, according to market research firm GfK.

In a recent report, GfK Asia said the highest growth for the region’s smartphone market was witnessed in the Philippines during the period, as the overall Southeast Asian smartphone market value expands by 62 percent.

Pressed for more details, GfK Asia Regional PR Manager Seraphina Wee told InterAksyon.com that smartphone volume growth in the country grew by a large 203 percent in the first quarter, or triple the original figure during the same period in 2011.

“The increasing availability of smartphones from major manufacturers catering to different price & consumer segments, as well as the growing receptiveness and smartphone literacy of consumers in Philippines [contributed to this growth],” Wee said.

Of all the smartphone types being shipped to the country, the GfK official revealed that Android-powered smartphones continue to dominate the short list, comprising more than 80 percent of smartphone volumes for the first quarter.

In the region, the Google-backed platform commands a strong 50 percent of the overall smartphone market, the GfK report said.

Dominated by a low-income group of mobile users, smartphones from Samsung and local brands such as Cherry Mobile enjoyed the highest rates of adoption in the country, with models retailing for as low as P5,000.

But despite the glowing numbers, the Philippines continues to trail traditional leaders in the region in terms of smartphone penetration: Malaysia and Singapore with 88 percent, and Indonesia with 62 percent.

With Southeast Asian markets nowhere near saturation, GfK Asia Account Director for Digital Technology Gerald Tan said the growth spurt should continue for the next couple of years, especially as prices of smartphones continue to stabilize within the region.

“With much of the populace still not owning a mobile phone, there is no better place for global mobile phone brands to focus their sales and marketing efforts,” he added.

source: interaksyon.com