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Monday, Aug 26, 2019

Samsung gains as Jobs quits Apple

Shares in Samsung jumped on Thursday and other competitors also benefited as Apple chief Steve Jobs stepped down, with analysts seeing a window of opportunity for rivals of the trailblazing US firm.

business Updated: Aug 26, 2011 15:23 IST


Shares in Samsung jumped on Thursday and other competitors also benefited as Apple chief Steve Jobs stepped down, with analysts seeing a window of opportunity for rivals of the trailblazing US firm.

The cancer-stricken Jobs the driving force behind iconic products such as the Mac computer, iPhone and iPad said Wednesday he would step down as chief executive and retreat to the back seat as chairman.

Apple, the world's second most valuable company by market capitalisation, said chief operating officer Tim Cook would succeed Jobs as CEO. The announcement sent Apple shares tumbling 5.3 percent in after-hours US trade.

But in Seoul, Apple's South Korean rivals rallied. Shares in Samsung Electronics, whose Galaxy tablet is sparring with the iPad, jumped three percent, while LG Electronics surged four percent.

Greg Roh, analyst at HMC Investment Securities, said the next three to four years would be vital for Apple's rivals as the Jobs era winds down.

"South Korean tech companies should work really hard to race ahead in this crucial period of time to catch up with or outpace Apple," he said.

Bryan Ma, at Singapore-based research firm IDC, stressed that the influence of Jobs had benefited the entire technology industry for both Apple and its rivals.

"It may be getting their (competitors') hearts pumping but it does not mean it will fall into their laps by default. They still have to work for it," he said.

"It does not matter who the competitors are, Asian or American, for them to capitalise it's whether they have the ability to captivate the hearts and minds of consumers the way Steve Jobs has."

Samsung has been embroiled in a series of patent lawsuits with Apple over designs and technologies in their smartphones and tablet computers.

Analysts said Jobs's departure would have little impact on the legal rows as Cook was unlikely to make any major change in direction for now.

Japan's struggling electronics giant Sony ended 2.06 percent higher in a strong Tokyo market. HTC, another smartphone and tablet computer maker, rose 2.7 percent in Taipei.

Chinese computer giant Lenovo, which has launched its own tablet and smartphone at home to compete in an increasingly crowded market dominated by Apple, rose 1.82 percent in Hong Kong.

And China Unicom, the mainland's second-largest mobile operator and sole distributor of the iPhone in China, soared 8.11 percent in Shanghai, although that was also driven by a better-than-expected first-half net profit.

"For handset makers it is a welcome relief their most formidable opponent and nemesis has retired," said Francis Lun, managing director of Hong Kong financial services firm Lyncean Holdings.

On the other hand, Jobs's resignation as CEO hit Taiwanese firms involved in Apple's huge supply chain.

Hon Hai, which assembles Apple's gadgets in China under the Foxconn name, fell 4.63 percent. Touchscreen maker Wintek dived 4.8 percent and Catcher Technology, which builds casings for Apple gadgets, lost seven percent.

Apple makes up around 35-40 percent of Hon Hai's revenues.

But Jeff Kang, at Seoul-based Daishin Securities, said new CEO Cook could actually benefit Apple suppliers in South Korea and beyond.

"Cook is known to have communicated well with Asian component suppliers when he was in charge of Apple's global supply chain," Kang told AFP.

"He must be more knowledgeable about South Korea than Jobs, and may be less hostile to South Korean suppliers given his past experiences."

First Published: Aug 26, 2011 15:19 IST

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