Analysts from research firm Barclays PLC (NYSE:BCS) expect an increase in the volume of iPhone and iPad following Apple Inc. (NASDAQ:AAPL) $1.05 billion patent victory against Samsung Electronics Co., Ltd. (LON:BC94). The nine member federal jury found the South Korean electronics company guilty of infringing six out of the seven patent claims of Apple.
Barclays analyst believe Apple’s suppliers including Largan Precision Co., Ltd. (TPE:3008), AAC TECH HOLDINGS (PINK:AACAF), and Foxconn Technology Co., Ltd. (TPE:2354) felt positive about the jury’s decision and will possibly increase their production to surpass Samsung’s market share on smartphones. Apple Inc. (NASDAQ:AAPL) is also expected to diversify its parts supply away from Samsung. In addition, most smartphone manufacturers are likely to use Microsoft’s Windows OS in their mobile devices. The analysts believe Nokia Corporation (NYSE:NOK) and HTC Corp (TPE:2498) will become major players in the smartphone market after launching their new products this coming September.
The analysts also believe HTC Corp (TPE:2498) will try to speed up its negotiation to settle its patent infringement case with Apple.
On the other hand, analysts from Morgan Stanley said Apple Inc. (NASDAQ:AAPL)’s victory in the patent infringement case against Samsung Electronics raised their confidence on iPhone 5, and expect an increase in smartphone market share for the device next year, by 30 bps. According to them, smartphone manufacturers will probably re-consider the current software and design of their upcoming smartphones, following the verdict of the federal jury.
Analysts from Morgan Stanley opined Apple’s victory is not about the money, because the company has $120 billion cash and investments. The analysts believe Apple’s biggest victory is the competitive consequence of the patent case. Its competitors will be forced to innovate their products by changing their software and hardware to make sure their designs are different from Apple’s products.
Meanwhile, Samsung’s stock value suffered a significant decline in the four years following its defeat in the patent case. The company lost as much as $12 billion in market value. Investors are concerned of the possibility that sales of the mobile devices will be prohibited in the United States.
Seo Won Seok, analyst at Korea Investment and Securities Co. said, “What’s concerning is whether any ban will be extended to flagship models and will have an impact on cases in other places. Perhaps Samsung has technology to avoid some infringements, but they also need to come up with ways to get around Apple’s patents within the Android operating system.”
According to Bloomberg, the South Korean electronic company’s share in the smartphone market is worth approximately $219.1 billion.
Apple Inc. (NASDAQ:AAPL) requested the court to ban the sales of Samsung in the country and a hearing on the issue is scheduled on September 20.
Samsung’s stock is down by 7.45 percent to 1,180,000 won per share at the Korean Stock Exchange on Monday morning.