Apple Biggest Competitor: It was not long ago when it seemed that Apple Inc. (NASDAQ:AAPL) was the only smartphone company worth talking about. However, things can and have changed in a relatively short period of time. Now, the Cupertino based company is doing all it can to fight off Samsung for the top spot in this ultra-competitive market.
While success can breed a lot of problems, as Apple has found out recently, the companies that make headway in this market also have the chance to rake in cash hand over fist.
Most people are familiar with Apple Inc. (NASDAQ:AAPL)’s cash hoard by now. One quarter after the next, the company sees its cash pile grow.
Now, it appears that Samsung is dealing with a similar issue.
During the first quarter of 2013, Samsung saw its net profit increase by 42 percent. With this much of an increase, it is only natural that the company would also get its hands on quite a bit more cash.
In this case, quite a bit more means a cash hoard that grew to just about $40 billion by the end of March.
With its net cash increasing, month after month, one has to wonder if Samsung is going to face some of the same issues as Apple Inc. (NASDAQ:AAPL).
This is something that a recent Wall Street Journal video segment talked about in greater depth:
“Samsung may have an Apple problem.”
This is how the video begins, and it pretty much sums up what is going on right now. Samsung seems to be facing the same situation as Apple Inc. (NASDAQ:AAPL), albeit a good one.
WSJ Technology Editor Scott Austin jumped in on the conversation, adding the following:
“What a great problem to have, right? Too much cash. They have about triple the amount of cash, nearly $40 billion, triple the amount of last year. Strip out the debt and it is still about $28 to $29 billion. This is really unchartered territory for Samsung. Of course, it is Apple’s main rival in the smartphone market. Samsung has historically reinvested its cash…”
It is true that Samsung has a long way to go before they have as much cash on hand as Apple Inc. (NASDAQ:AAPL), the company is now dealing with a good problem to have. How they approach this situation moving forward will be quite interesting.
For more on Apple’s cash hoard, an update from a couple months back before its dividend announcement, check out the video on the next page: