Samsung 'undisputed' Android king, takes 95 percent of Q1 profits

Samsung 'undisputed' Android king, takes 95 percent of Q1 profits

Summary: The Android smartphone market generates US$5.3 billion in operating profits for the quarter, and Samsung contributes US$5.1 billion of that figure.

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In a first quarter which saw smartphones powered by Google's Android operating system (OS) generate US$5.3 billion in operating profit, Samsung Electronics managed to capture 94.7 percent of the overall market.

According to a study by Strategy Analytics released Wednesday, the overall smartphone industry raked in US$12.5 billion in operating profit during the first three months of this year. Of this, the Android platform accounted for 43 percent, or US$5.3 billion, during the quarter, it noted.

Global Android Smartphone Profit by Vendor: Q1 2013 Operating Profit (US$, billions)
Profit Share (%)
Samsung 5.1 94.744
LG 0.1 2.525
Others 0.58 2.732
Total 5.3 100
Source: Strategy Analytics

In terms of vendors, Samsung dominated the Android market, cornering just under 95 percent of the operating profits generated to reach US$5.1 billion in the quarter. LG was a far second with 2.5 percent profit share at US$100 million, while other Android handset makers combined made up 2.7 percent of the market.

Woody Oh, senior analyst at Strategy Analytics, noted in the report that Samsung's profitability was due to its "efficient supply chain, sleek products and crisp marketing".

Neil Mawston, executive director of the research firm, added Samsung is the "undisputed king" of the global Android smartphone industry. "Samsung has strong market power and it may use this position to influence the future direction of the Android ecosystem. For example, Samsung could request first or exclusive updates of new software from Android before rival hardware vendors," Mawston said.

One example of this market power was seen when Google announced Wednesday it would be selling the Galaxy S4 in a pure Android flavor without the South Korean company's software overlays on its Play online store, and provide speedy system updates to the device as these are rolled out.

LG, by contrast, currently lacks the volume scale needed to match Samsung's outsized profits, Oh pointed out.

Another study by Gartner released Monday showed Android claiming 74.4 percent of the global smartphone market share by number of units sold. A total of 156.1 million Android-based smartphones were sold in the first quarter of this year, and Samsung led vendor sales with 30.8 percent market share, or 64.7 million units, in the quarter, it stated. 

Topics: Mobile OS, Mobility, Samsung, Smartphones

Ellyne Phneah

About Ellyne Phneah

Elly grew up on the adrenaline of crime fiction and it spurred her interest in cybercrime, privacy and the terror on the dark side of IT. At ZDNet Asia, she has made it her mission to warn readers of upcoming security threats, while also covering other tech issues.

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16 comments
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  • Samsung the kingpin and behemoth.

    But as Nokia has already proven ... being on top actually means nothing at all. In 5 years from now Samsungs handset division might be in the same dreary & gloomy state as is HTC now (which itself was a serious contender couple of years ago).
    EnticingHavoc
    • Re: dreary & gloomy state as is HTC now

      Which, interestingly, is still better than Nokia is doing.
      ldo17
  • Cheap tacky cr@p.

    Cheap tacky cr@p that needs upgrading every 6 months.
    Mombasa69
    • Ok....

      Can you finally use your Nokia Windows Phone properly yet?
      Gisabun
  • They have channeled Steve Jobs

    Where as Microsoft is channeling Steve Ballmer, Samsung is channeling Steve Jobs and it is working. Some how they have tuned in to his genius.
    Tim Jordan
    • Hardly

      When they said that

      "...Samsung Electronics managed to capture 94.7 percent of the overall market."

      They didn't mean the overall smartphone market, just the Android part.

      Apple make twice as much, 65% of the overall mobile phone market's profit, just on iPhones. Samsung's 94.7% comes out of part of the other 35%.

      Samsung is picking up a lot of the rest, but it's not by "somehow tuning in to his genius", so much as blatantly copying his designs.

      The bottom line is that only high end smartphones make any money at all. That's how Nokia managed to haemorrhage money for years, while they were still the world's number one mobile phone vendor.
      Henry 3 Dogg
  • 55+ year olds are in fear of becoming dinosaurs

    I was once in fear for my career when AT&T went from C to C++. I was a consultant at the time and companies trained only their employees, not consultants. We had to know it already. Great! I somehow caught up. This same emotion is bubbling up now. I see it at work. The older men who know only Microsoft are scared and are stepping up their defence of Microsoft.
    Tim Jordan
    • Exactly

      Adapt or go extinct. Sticking your head in the sand or covering up your ears and yelling "I can't hear you!!!" gets you nowhere.
      dsf3g
  • Still Better Than Windows...

    ...where Microsoft is getting about 105%.
    ldo17
    • That's actually a lot better than anyone could hope for, that "105%".

      ;)
      adornoe
      • Re: that "105%"

        It's a consequence of so many Windows OEMs losing money on Windows right now.
        ldo17
        • Okay, smartazz!, show us the OEMs that are losing, and how much,

          and guesswork and wishful thinking don't count.

          With so many OEMs now coming out with so many different models of PCs/tablets for Windows 8, it's very likely that they see a much brighter future than most here think. No OEM is going to continue tossing money at something they think to be a loser.
          adornoe
  • The question then is: Why is Android still being called Android, when it

    should be called the Samsung OS?

    The Android smartphone is, basically, the Samsung smartphone. So, isn't it about time to start referring to the smartphone players as being Samsung (not Android) and Apple, and Microsoft (Nokia, really).
    adornoe
    • Re: The Android smartphone is, basically, the Samsung smartphone

      Except most Android buyers are not buying Samsung.
      ldo17
      • Samsung's Android Share at 95 Percent

        "Android Market Share: 900 Million Total Activations Projected; Samsung's Android Share at 95 Percent"

        http://www.latinospost.com/articles/19220/20130515/android-market-share-900-million-total-activations-projected-samsungs-95.htm

        "According to the first quarter of 2013, Samsung made a cool $5.1 billion in profits from the global Android smartphone profit share. The share equated to an outstanding 94.7 percent, easily trouncing other competitors who utilize Android as well. LG Electronics finished second, but only with $0.1 billion, or 2.5 percent of the profit share.

        "We believe Samsung generates more revenue and profit from the Android platform than Google does," said Strategy Analytics Executive Director Neil Mawston"
        adornoe
        • Re: Samsung's Android Share at 95 Percent

          More like 30 percent. Most Android devices really are not made by Samsung.
          ldo17