South Korean media says Samsung is in an awkward position: profits lag behind Huawei’s growth as Apple’s

Although Samsung Electronics was the world’s largest smartphone maker last year, it is not having a hard time, South Korean media reported. That’s because Apple is ahead in terms of profits and behind Huawei in terms of growth. Who is the winner of the global smartphone market in 2019? In terms of profits, the winner is undoubtedly Apple. In terms of growth, that’s naturally Huawei.

Samsung Electronics, by contrast, appears to be caught between Its U.S. and Chinese rivals because it can’t make more money than Apple or grow more than Huawei.

Data released by Strategy Analytics, Canalys and Counterpoint also support this conclusion, with Apple and Huawei significantly better than Samsung in terms of profit and growth, respectively.

South Korean media says Samsung is in an awkward position: profits lag behind Huawei's growth as Apple's

Apple’s phones typically sell less than Samsung, but make more money, which is nothing new, as has been the case since 2018. In the fourth quarter of 2018, Apple accounted for about 80% of operating profit spree in the mobile phone market.

In the third quarter of last year, Apple continued to dominate the global mobile device market, earning 66 per cent of the industry’s profits and 32 per cent of its mobile phone revenue, according to Counterpoint. Samsung Electronics came in second, but accounted for only 17 per cent of the industry’s profits, although it was up less than 10 per cent from the end of 2018.

Even so, Samsung Electronics’ share of profits is higher than all of its Chinese rivals combined, as companies such as Huawei, OPPO, Vivo and Xiaomi are aggressively expanding into the mid-to-low-end handset market.

“Chinese brands are launching new feature-rich flagships at affordable prices, offering attractive products to mature smartphone users,” said Karn Chaunhan, an analyst at Counterpoint. “

In fact, Samsung’s profit margins are relatively low, comparable to those of its Chinese rivals. But it is the world’s largest smartphone supplier.

Samsung shipped 297 million smartphones in 2019, according to average global smartphone shipments from Strategy Analytics, Canalys and Counterpoint. Huawei is the second largest supplier, with 240 million units shipped. Apple sold 197 million iPhones.

Huawei’s share of shipments rose the most, to 17 percent, from 204 million units in 2018 to 240 million last year, according to Canalys. By comparison, Samsung Electronics’ shipments rose just 2 percent, from 293 million units to 297 million units, while Apple’s shipments fell 7 percent last year.

In response, one industry observer said: “Given the continued contraction in the global smartphone market, the massive expansion of shipments by Chinese manufacturers could change the market leadership landscape in the near future.” “

Analysts at Counterpoint believe that Chinese suppliers, especially in the coming quarters, are preparing for full commercialization of 5G globally, could benefit and use the opportunity to raise their average selling prices.

Of course, Samsung will not show weakness. On Sunday, Roh Tae-Moon, Samsung’s new head of mobile operations, said the team would show the world this year how to change the current industry landscape.

“It’s our responsibility and opportunity to shape the next 10 years of mobile innovation,” he said. You’re going to see something exciting to show how we can drive progress, change the shape of the future, and introduce new mobile experiences. “