Samsung Sales May Surpass Nokia, Apple

Samsung Sales May Surpass Nokia, Apple

Samsung may have surpassed Nokia and Apple in smartphone sales for the second quarter on the strength of its Android devices, tightening the race for top handset maker.

The South Korean electronics giant is estimated to have sold 18 to 21 million smartphones globally in the April-June quarter, compared with 16.7 million for Nokia and 20.3 million iPhones, according to projections by Boston-based Strategy Analytics.

Samsung’s strength as a seller comes from not only its high-end handsets, which have higher profit margins, but also from its lower-priced devices in emerging markets, which compete on volume. If Samsung continues to capitalize on its presence in emerging markets around the world, it may keep leading globally on a quarterly basis.

“Samsung’s Android portfolio is selling strongly in most regions,” said Neil Mawston, analyst at Strategy. “Samsung stands a reasonable chance of capturing the top spot on a quarterly basis if it can continue expanding its Android portfolio across high-growth markets like China and Brazil. Samsung and Apple will be at similar levels in smartphones by the end of the year.”

Initially, Samsung lagged behind Nokia and Apple in the first quarter of the year, according to researcher International Data Corp. But sales picked up with the launch of the Galaxy S2, the successor to its best-selling Android device, unveiled last February. The handset helped Samsung more than double operating profit at its mobile phone business in the second quarter, according to Bloomberg.

The Galaxy S 2 may currently enjoy strong sales, but the handset is one of the targets of an ongoing legal battle with Apple, which slapped Samsung with a suit last April alleging it infringed on the design and technology of its iOS devices. The suit set off a storm of countersuits and injunction requests between the two companies, which may impact the Galaxy devices with licensing costs or outright trade bans if the courts rule in Apple’s favor.

Apple, too, will roll out the iPhone 5 this September, according to speculation. The handset may boast a stronger chip for processing data and a more advanced camera, and will prove a threat to Samsung’s sales in the market.

“Samsung will need to work hard to hold off that competitive threat,” he said.

However, Samsung’s gains on Nokia look to hold this year. Including basic and feature phone sales, Samsung will probably have a 20 percent share this year, compared with Nokia’s 26 percent, according to Strategy, narrowing the gap between the world’s two largest handset makers.

Nokia’s market position has steadily eroded with its lack of a presence in the high-end U.S. smartphone sector. The company is fighting to regain territory via a strategic partnership with Microsoft, which will soon find the Windows Phone OS on Nokia handsets. But those devices are not scheduled to launch until later this year, giving Samsung time to solidify its presence.

Samsung’s sales, fueled by its Galaxy handsets as well as continued feature phone sales, allow it to compete strongly at multiple price points in the market. The smartphone market is fast-moving and highly competitive, however, and the company will have to fight to stay competitive, not only in the market but in the legal arena as well.

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