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

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.
Written by Ellyne Phneah, Contributor on

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. 

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