Ronnie05's Blog

Smartphone device market shares and profit shares

Posted in Industry updates, Mobile Devices and Company Updates by Manas Ganguly on August 1, 2011

Strategy Analytics in its AMJ (Q2) quarter has declared Apple to the king of the smartphone crown. Apple cornered 18% of the 110 million unit smartphone market which itself registered a 76% growth Y-o-Y.In Q1, 2011, Apple had become the world’s largest phone vendor in terms of revenue. Samsung scored a close no.2 even when it was expected by analysts to become the no.1 vendor. Samsung’s growth story has seen impressive success, and its shipments grew a huge 520 percent annually from 3.1 million smartphones in the year ago quarter.

The Apple wonder doesnot just stop there.. the 18% smartphone volume market share translates into 66% profit share of the mobile phones.(Base calculated is 365 million as per IDC numbers) To put it other way around, Apple which contributes 5.5% of mobile phones by volumes, takes a disproportionate 66% of the mobile phone industry profits. This is up against from 57% share of profits same time last year. This Q2,2011 quarter saw a slight sequential decline in overall profit for the mobile phones, but Nokia, Motorola, Sony-Ericsson and LG did not manage a profit from selling phones. Apple’s share is up from 57% in Q1 and 50% in Q3 and Q4. Samsung’s share went to 15%, though that’s not a peak level historically. In Q1 2008 the company was at 21%. RIM was at 11%, a level in a range that has been unchanged for three years. Finally, HTC captured 7.4%, a new high and an increase from 6% since last quarter.

Smartphones have become the primary driver of mobile phone vendor profitability, giving Apple a significant edge over most of the competition with its smartphone-only offerings.

Apple’s ability to out-innovate competition has been a key to its domination of the profit shares. Come October and one expects that iPhone5 and a low cost iPhone would add another dimension to Apple’s ability not only to exact high profit shares but also maintain its lead in the device volume shares.

Data courtesy: Strategy Analytics, IDC, Asymco

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