Apple's survival strategy in the peak smartphone age focuses on internally driven growth, while Samsung pegs its fortunes to the wider mobile market:
49% YoY. The increase in wearables revenue to $5.5 billion — driven by Apple Watch and AirPods sales — doesn't make up for the decline to $53.8 billion in mobile phone revenue. But if wearables revenue continues this growth, it could fully offset that difference in the future, especially combined with growth in Apple's other auxiliary revenue channels like services.for Q2 fell 4% YoY, with its mobile business exhibiting tepid 7% growth.
Apple's business is as a purveyor of its own products and the services that are delivered through them. The company is bringing its existing base of loyal customers even further into its ecosystem, selling iPhone users other devices like iPads, AirPods, and Apple Watches, as well as getting them to subscribe to things like news services.
That gives Apple a limited long-term ceiling for its growth: The overall population of potential customers isn't increasing greatly thanks to the strategy of deepening its current population. But it also means that Apple will succeed or fail based on its own products, rather than being subject to the moves of others.
On the other hand, Samsung's strategy for continued success is dependent upon the continued growth of the mobile market and the performance of the companies that it supplies. Nearly half of Samsung's quarterly revenue is dependent on its role as a supplier for the computing market. Its semiconductor business doesn't just supply chips and memory for its own phones, but also for those of competitors including LG and Sony. As thoseThis dependency gives Samsung a higher ceiling for potential growth, as it's not dependent solely on its own devices. But it also allows for greater variability and the potential for disaster should Samsung's apparent belief in the mobile market's potential to grow further in the next few years turn out to be inaccurate.
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