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Samsung Passes Nokia To Become Top Cellphone Maker In The World

Samsung is now the top overall handset maker, maybe the top smartphone maker.

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Samsung Passes Nokia To Become Top Cellphone Maker In The World
[ Technology]

Samsung has released their earnings report for the first quarter of 2012, and it seems that for the first time the Korean company has overtaken Finnish rival Nokia to become the top mobile handset maker in the world. Samsung reported revenue of 45.27 trillion Korean won ($39.9 billion) and operating profit of 5.85 trillion won ($5.16 billion), a year-over-year increase of 98%.

Meanwhile, Nokia’s quarterly earnings report revealed a company undergoing considerable struggles. Despite €7.3 billion ($9.6 billion) in net sales, the company suffered net losses of €1.34 billion ($1.7 billion). Nokia CEO Stephen Elop attributed the losses to “greater than expected competitive challenges,” brought in large part by Android-based smartphones making inroads into the budget phone market, a segment once dominated by feature phones (most of which were made by Nokia).

In addition to generating nearly $7 billion more in profits than Nokia, Samsung also passed Nokia to become the biggest mobile phone vendor in the world. While the company did not release exact figures for its mobile phone sales, it hinted that 92-93 million units were sold. Nokia, on the other hand, reported that they sold 82.7 million units.

Where things get interesting, though, is when we start to look at smartphone sales. Since Samsung’s earnings report was released this morning, two separate analytics firms have come to two separate conclusions about whether Samsung or Apple is the top smartphone vendor in the world. Strategic Analytics says Samsung, IHS iSuppli says Apple.

First off, it’s worth noting that both firms agree that Samsung has overtaken Nokia in overall handset sales, with Apple solidly in third place. Here’s iSuppli’s data on overall handset sales:

IHS iSuppli's Cellphone Shipments Chart

Now here’s Strategy Analytics’s:

Strategy Analytics's Handset Shipments Chart

The problem ultimately stems from the fact that while Apple reported the number of iPhone sales in their quarterly earnings report, Samsung did not say what percentage of their handset sales were smartphones. That means that figuring out how many smartphones Samsung sold is a matter of estimation. Strategic Analytics estimates that Samsung sold almost nine million more smartphones than Apple in the first quarter: 44.5 million to Apple’s 35.1 million:

Strategy Analytics's Smartphone Shipments Chart

iSuppli, on the other hand, estimates that Samsung only sold 32 million smartphone units (down four million from the previous quarter):

IHS iSuppli's Smartphone Shipments Chart

Without actual data from Samsung on their overall handset sales and their smartphone sales, it’s difficult to know which estimates are correct. That said, the overall trend in the mobile phone market has been for smartphones to take up an increasing proportion of the market. iSuppli’s requires Samsung’s proportion of smartphone sales to overall handset sales to remain the same. That said, it seems likely that Strategic Analytics’s data is closer to the mark, and that Samsung really did sell in the neighborhood of 40 million smartphones in the first quarter.

If that’s so, then Samsung really is the biggest smartphone maker in the world, with Apple a fairly close second. What will be most interesting is to see how those figures change in the coming months. Samsung is set to unveil the next addition to their Galaxy line of smartphones next Thursday at a media event in London. That is likely to provide a significant boost to Samsung’s smartphone sales for the second quarter. Apple, meanwhile, is not likely to have a new iPhone on the market until September or October, which means that Apple’s iPhone sales for the next quarter are likely to continue slowing down.

In any event, whether Apple is the top smartphone maker or Samsung is, the fact remains that the two companies effectively split the smartphone market between them. Other smartphone makers – HTC, Nokia, Motorola, etc. – are left squabbling over a distant third place.

Samsung Passes Nokia To Become Top Cellphone Maker In The World
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