Samsung Takes Over From Apple As The World's Most Profitable Phone Manufacturer: Strategy Analytics

Samsung Electronics Co. (LON:BC94) has overtaken Apple Inc. (Nasdaq:AAPL) as the world’s most profitable phone manufacturer, according to a report by Strategy Analytics.

Samsung's handset division had an estimated operating profit of $5.2 billion in the second quarter of 2013, beating Apple’s estimated profits of $4.6 billion over the same period, according to the report.

Samsung’s mobile phone shipments were up by 4 percent to 386 million, representing about 27.7 percent of the entire cell phone market, ahead of Nokia (NYSE:NOK) with 15.8 percent and Apple with 8.1 percent.

"This was the mobile phone industry's fastest growth rate since the second quarter of 2012," said Neil Shah, senior analyst at Strategy Analytics.

"Strong demand for entry-level Android devices in Asia and Latin America drove much of the growth. Samsung continued to dominate, shipping 107 million mobile phones worldwide."

In contrast to Samsung’s growing share in the market, Apple has seen its share shrink to 14 percent, its lowest in three years. In the Android sector, Samsung represents 95 percent of all phones sold.

"The current iPhone portfolio is underperforming and Apple is at risk of being trapped in a pincer movement between rival 3-inch Android models at the low-end and 5-inch Android models at the high-end," said Neil Mawston, the research firm's executive director.

"With strong volumes, high wholesale prices and tight cost controls, Samsung has finally succeeded in becoming the handset industry's largest and most profitable vendor," he added.