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That $7.8b Apple-Samsung Deal isn’t as big as you might think

The hot story today is about the deal that Samsung and Apple are about to sign. Over the next year, Samsung will provide $7.8 billion worth of components for the iPad and iPhone. this deal would make Apple the single largest customer of Samsung.

I’m sure you’re thinking "wow, that’s a lot of money. Maybe Apple should merge with Samsung." That was my first thought, but then I decided to see much this deal matters to Samsung.

It’s not as big as you think. According to Wikipedia, the Samsung Group earned revenues of $172 billion in 2009. This deal is only worth about 5% of Samsung’s revenues. It’s big, yes, but not overwhelming. In fact, I wouldn’t be surprised to discover that Samsung’s retail operation in the US were worth nearly as much.

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Comments


Scott G. Lewis 14 February, 2011 um 1:58 pm

Deal signing that makes the new party the largest customer, instantly? 5% of revenues? I think that is a pretty big, overwhelming deal.


Zigwalski 14 February, 2011 um 5:11 pm

When you are dealing with that type of high dollar amounts, 5% is a huge deal. You continue to astound me with your lack of business knowledge.

Also these are components not Samsung products being sold. This is genuine profit making items not subjected to the marketplace trends and discounts. Of course, if the marketplace goes south, Apple may not use them next year.

Nate the great 14 February, 2011 um 5:48 pm

Do you know what? I’m tired of you. Good-bye.


Tyler 15 February, 2011 um 11:44 pm

Samsung Electronics had sales of $119 Billion. That would be a tad bit lower than the whole Group.


James Wells 13 August, 2013 um 2:51 pm

You do know that Samsung is a conglomerate and have around 90 companies doing and making different things, and if you add up the value of all of these companies, Samsung Group is actually worth around a Trillion Dollars, so technically Samsung group is bigger than any other company on this planet and make more things that any other company. So 7 billion is nothing in samsung really!


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