Anyone viewing the world through the prism of their iPhone screen could be forgiven for thinking they’ve woken up in some kind of alternate reality. After all, Apple Inc’s perennial rival, Samsung Electronics Co, has endured months of public humiliation over the catastrophic failure of batteries in its now-recalled Note 7 smartphone.
And yet, Samsung’s shares on Wednesday hit a record high in Seoul at 1.747 million won, or just under $1,500 a piece bringing over 39% in gains so far this year. This is despite witnessing the biggest drop in its smartphone market share and sales this year.
The surge is a result of the various steps Samsung outlined to boost shareholder value in the short term which added $9 billion to its market value.
The most valuable Korean company is also reviewing the proposal to split its corporate structure into two separate businesses, a move that could be another boon for its stock price and simplify the company’s structure in the longer term. The new structure would see Samsung reorganized into one holding and one operating company, however a decision isn’t expected to be made for another six months.
Compared to Samsung’s 39% gains this year, its biggest rival (at least when it comes to smartphones) Apple’s gross margin hovers around the 40% mark, a percentage point or two above Samsung’s. The also-ran maker of desktop computers has witnessed the value of their holdings drop for four consecutive days. Apple shares are now almost a fifth lower than when the share price peaked in April last year.
If all the business talk goes over your head, and you’re just a Sammy fan, all you should know is Sammy had quite a good day. But it was not all roses either.
You might remember the court case between Apple and Samsung regarding iOS patent infringements. Samsung’s appeal for another hearing has been rejected by the US Court of Appeals. The Korean company had already lost the case once, back in 2014, which related to auto-correct, quick links, and slide-to-unlock patents held by Apple for use with iOS. Samsung was ordered to pay $119.6 million at the time, which is a lot less than the $2.2 billion that Apple requested.
Via : VentureBeat