Will Samsung Destroy Apple This Year?

Apple’s (AAPL) iPhone business has not lived up to the expectations this year. However, not only has the iPhone underperformed but the iPad and Watch business has not been on par as well. According to the analyst Ming-Chi Kuo, the company’s next-generation Apple Watch hardware could disappoint user because of underwhelming hardware enhancement instead of one which changes its appearances.

Kuo also reported that new Apple Watch will comprise no major specifications enhancements with inadequate changes to form factor design, but did not reveal which components would be improved.
On the other hand, Apple not only reported a dip but also shared that the sales will considerably move downward for the remaining year. Moreover, the worldwide mobile market shrunk for the first time ever this year further adding to its woes.

Apple is now headed on the track which will take the company downward and it is less likely that the upcoming iPhone could change this. Apple has a significantly diverse software culture as compared to its major rivals like Samsung (SSNLF) and takes a long time to develop an upgrade.

However, Apple’s culture fits perfectly in the case of hardware, as hardware development cycles are time-consuming, and it takes an absurd amount of effort and accuracy to introduce a product that looks perfect and runs efficiently. Once a product is created, it is an easy task to change it. Though, it appears that the company has mislaid the same vision in terms of software.

Designing leading-edge software services and cloud platforms are tough, as it is not a commodity module that gets improved just by engaging more developers to work on it. The software is a prospect that has thought inventors and frontrunners that developers want to work for, and this is correct for both the tangible implementation level as well as the long-term vision level.

At the present stage, most of the Apple’s software facilities are comparatively ordinary things like Apple Care, iTunes, and Storage. The company’s Apple Pay is a good move, but it is not likely to spawn significant revenue in the short term. Apple is also losing huge market share to its foremost rival Samsung mainly due to the launch of Galaxy S7/S7 Edge.


Losing market share to Samsung is going to put downward pressure on Apple. As I have said before, I think Apple has peaked and it will not reach its 52-week high levels unless it finds another big growth driver.
Published on May 5, 2016
By Prudent Investor

Copyrighted 2020. Content published with author's permission.

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