Samsung Surpasses Apple in Sales in Q2, 2013

The notion that Apple would continually reign as top dog, innovating above competitor levels is no longer true–at least with sales.

According to new research from Strategy Analytics, Samsung is now the world’s leader in handset sales for Q2 2013, with Apple in second place. Samsung’s global handset operating profits is estimated at $5.2 billion whereas Apple’s is estimated at $4.6 billion.

Apple had been the leader in handset sales for nearly four years, from Q3 2009 to Q1 2013. Samsung, as the new leader, now accounts for 28 percent share of all mobile phones shipped worldwide for Q2 2013–with the overall sales worldwide having increased annually by 4 percent.

“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,” said Neil Shah, senior analyst at Strategy Analytics.

Neil Mawston, executive director at Strategy Analytics, said that:

“Apple’s profit margin for its handset division has been fading recently due to lackluster iPhone 5 volumes and tougher competition from rivals. Samsung is performing well in the US market, while Huawei, ZTE and other local brands are growing vigorously in China. Apple is now under intense pressure to launch more iPhone models at cheaper price-points or with larger screens to fend off the surging competition and recapture lost profits in the second half of 2013.”

For Apple, the news is, of course, disheartening and a wakeup call; whereas for the consumer, when brands compete more it translates to cheaper prices and more features. And as smartphone makers look to reach a wider mass of people, namely those who can’t afford the current price-points, one can expect the cost to decrease even further.

But discounting its products and offering cheaper products isn’t something Apple is known for. However, perhaps that may change. And in fact, the company is currently offering an up to $200 savings discount to college teachers, students, and staff. Not to mention, the estimated average price for a smartphone has decreased from $375 to $450 since 2012, according to research firm IDC.

All of which pose the question of whether the consumer will continually fork over extra dough to purchase the latest and greatest iPhone. Or whether, at some point, the consumer will decide that enough is enough, that they are satisfied with their current iPhone. One thing is for sure: This sales report from Strategy Analytics shows that the iPhone 5 couldn’t sell enough to keep Apple’s sales lead.

So, look out Apple!

Article Source: Samsung Surpasses Apple in Sales; Will the New iPhone Be Cheap to Compete?