Global Tech Giants Profitability Domination

Apple has competitors with smartphones and applications but Apple has 75% of smartphone hardware profits. Apple has about 40% margin and makes far more profits from its iTunes ecosystem. Samsung is usually among the top four in smartphone unit sales but Samsung makes more from semiconductors and appliances than from smartphones. Xiaomi is one of the biggest in smartphone unit sales with $12 billion in quarterly sales but profits is about $100-300 million per quarter. Apple is making about $30 billion in a quarter. A good quarter for Xiaomi is 100 times less profit than Apple. Samsung is making maybe $1 billion in smartphone profits in a quarter. Samsung global businesses make $10 billion in quarterly profit.

China’s biggest market value company is Tencent. It is the 11th most valuable in the world. Alibaba was ahead but President Xi has been crushing Alibaba.

There are some legacy companies with strong profits. Those are Saudi Aramco, Berkshire Hathway, Ping An Insurance and some banks and oil companies.

The companies with multi-trillion valuations or the ones that could get there are the ones with insane profits and constant high profitability growth.

America’s big tech dominates global big tech which dominates profitability. Tencent is more than 5 times smaller than Apple. Tesla will prove its massive profitability story starting with over $3 billion in profit in the next earnings call. Each quarter in 2022 will show massive growing profits.

Tencent has partially cracked the massive profitability code.

China and Asia’s big companies are at least competitive with products and services. The legacy companies (Nokia, Blackberry, Motorola) got swept away by Apple Tesla will sweep away Toyota, VW, GM and Ford. The ones that remain will be barely profitable. Tech giants suck the profitability out of their industries globally. Only another player working from an adjacent dominant position can compete and maintain strong profitability. Microsoft and Google can compete profitably against Amazon in the cloud industry.

TSMC (chips) and AMSL (advanced chip-making lithography machines) are strong and dominant suppliers to the big tech players.

CATL is more profitable and has more value than any china EV car company and any EV company that is not Tesla. CATL is the biggest lithium battery maker and they are supplying Tesla as a close partner.

SOURCES- Imore, scmp, companies market cap
Written By Brian Wang, Nextbigfuture.com

7 thoughts on “Global Tech Giants Profitability Domination”

  1. I see no facts about other car manufacturers adapting Teslas production methods in the links that you supplied. Could you provide a link?

    Reply
  2. Well, your link to Mobileye is about a chip that will be launched at the end of 2023. It will have about the same performance as Teslas current system. That's entering very late in the game…

    And as you probably know, getting to level 4 or 5 self driving is all about SW. Correct me if I'm wrong, but Mobileye has very little self driving SW to sell.

    So no real competition after all?

    Reply
  3. Huge mish mash. Amazon is the biggest online shopping company, at least in the West, its profits are from its cloud business, a side digital business, Just like apple. Tesla does not have such a successful digital side business that it sells to others. Companies such Mobileye are ahead of it in selling its driving autonomy to others. There are no huge profits in building cars, just like there isn't in building smart phones and shipping products. Other companies are making gains in adapting Tesla assembly methods and Tesla is rapidly loosing its market share. Soon it will have to start cutting profit margins.

    https://techcrunch.com/2022/01/04/intels-mobileye-autonomous-driving-chip-for-consumer-vehicles/

    https://www.yahoo.com/news/tesla-is-at-risk-of-losing-its-market-dominance-analyst-185721382.html

    Reply

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