Moto G makes tidy profit for Google, according to analysts

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If you thought there was no way Motorola was able to make money form the Moto G, think again. A new study posits that Motorola has worked in a tidy profit into each Moto G handset, and will clear about 5% from each sale once all is said and done. For consumers, this is great; we get a really nice device at a stellar price. For other OEMs, it could pressure them to follow suit.

Research firm TechInsights is speculating that the components inside the Moto G cost Motorola roughly $123. At an asking price of $199 for the 16GB model, Motorola would make around $76 per handset. Considering Motorola says they make money on every device sold, analyst Mark Newman from Sanford C. Bernstein & Co. proposes that Motorola’s total profit margin is less that 5% per handset after operating costs. If true, that gives them a max net profit of $2.50 per device sold at that price point.

Comparatively, Newman thinks Samsung has a 20% profit for similarly specced devices such as the Galaxy S3 Mini, and up to 28% on a Galaxy S4. A colleague of Newman’s notes that Apple makes a 30-35% margin on each 5S or 5C sold, so Motorola could be bucking a huge trend. This is, of course, speculative and lacking a factual basis, but these types of analysis often shed light on other issues within the mobile spectrum.

Since being purchased by Google, Motorola has seen a renaissance of sorts. In an effort to reinvent themselves, Motorola has done everything we could ask of an OEM. They’re responsive to consumers, active on social media, and competitively price their handsets. They also offer customization outside of cases and covers, and a host of great accessories.

With the Moto G, we are given a true mid-range powerhouse device. It’s a strong showing for Motorola, and a great follow-up to the Moto X. While a device with the specs of the Moto G fails to excite our tech-savvy souls, the pricing does. At $199, it makes an easy burner smartphone, or a step up for those on feature phones.

Motorola is striking a key balance for the US market, and setting a standard worldwide. While they don’t follow the Xiaomi model of selling a device at cost and making profits up via add-ons like cases or accessories, they also don’t go with the market flow of selling a device for maximum allowable profit. For a worldwide stage, Motorola is set up for success. The Moto G will go over quite well in emerging markets, and prices itself at a level other OEMs don’t seem willing to approach. If Motorola plans to actively encroach on Samsung’s dominance of Android, theirs is a solid game-plan.

Samsung: When the mobile Division stifles profit

By Jean-Louis Petrod on July 26, 2013

At the time, all manufacturers their benefits quarterly, Samsung reveal, is no exception to the rule, and profits of $6.96 billion 2013 announced in the second quarter. An impressive number, it should not necessarily with S4 Galaxy sales among the more than satisfactory, first, even if estimates.

Record sales of mobile phones, if you, an increase of 9% compared with the first quarter of the year and 54% compared with the second quarter 2012.

A quarter who get benefits of Samsung constantly, but despite the Korean not less than 23.4 million units are the latest high-end phone for sale and one-third of the 71 world over smartphones millions in the second quarter of 2013 all manufacturers combined, this growth does not necessarily based on the mobile market.

Cost of the Mobile Division reduce the advantages of Samsung.

Therefore, we look at the detail of the Samsung's profits, it fast, that most of the profits mainly electronics products is recorded in the second quarter of 2013 of the Korean public, followed by computers during mobile devices only in third place come. Then come the screens then the profits of semiconductors by the brand.

Despite an overall growth of about 8%, Samsung mobile Division operating profit nevertheless fell by 3% during the same period therefore suggest that income, the levels start to stabilize.

Made a marginal profit expected by the generated costs, especially in marketing, introduction of new products, but also in research and development.

Also saturated indicating that decreased sales of tablets of the brand now developed markets and fast-growing emerging markets.

Samsung always in difficulties-growth in the second quarter of 2013.

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Google Q1 2013 earnings: $13.97 billion in revenue, $3.48 billion profit

Google has just released its Q1 2013 earnings report, and while we listen in on the earnings call we're going to break down some of the raw numbers for you:

$13.97 billion in revenue for the quarter, up 31-percent year-over-year$3.48 billion in operating income, up slightly y-o-y but down as a percentage of revenueGoogle-owned sites represented $8.64 billion of those revenuesGoogle Network (partner sites) represented $3.26 billion of revenueMotorola posted $1.02 billion in revenues, 7-percent of Google's totalMotorola ended with an operating loss of $271 million for Q1

A strong quarter for Google is seeing revenues increase largely over the same quarter last year, but while revenues did increase in nominal terms they did decrease in terms of share of revenues. Income from each different area of Google were strong, and though the number of paid clicks (for advertisements) increased about 20-percent the cost-per-click fell slightly by 4-percent. Speaking to Motorola specifically, the unit had $1.02 billion in revenue for the quarter, but is still posting a loss of $271 million in the end.

Source: Google