Apple becomes most profitable cell phone maker

BANGALORE, INDIA: Within just two years of entering the business, Apple has overtaken the world's two largest cell phone makers by generating highest operating profit in the industry. Its operating profit in the third quarter was 1.5 times larger than those of Nokia and Samsung Electronics on the back of its flagship iPhone.

The California-based company achieved US$4.5 billion in sales and operating profit of $1.6 billion from the iPhone in the July to September period, U.S. market researcher Strategy Analytics said Tuesday. Nokia posted $10.3 billion in sales but its profit stood at only $1.1 billion in the same period, while Samsung recorded some $9.3 billion in sales and around $1 billion in profit in the IT sector including mobile phones. 

Apple's emergence as the profit leader is thanks to its strategy of focusing on high value-added smartphones. According to industry estimates, the iPhone's market price, before various discounts, is around $800, and its production cost is less than one third of that.

Apple adds value to the iPhone by making it easy to operate and featuring diverse applications. As a result, although it sold only 7.4 million units in the quarter, it raked in more profit than Nokia and Samsung, which sold 100 million and 60 million units, respectively.

According to IDC, another U.S. market researcher, Nokia was the leader in smartphone sales in the third quarter with a market share of 37.9 percent (16.4 million units), but it has a serious profitability problem. Meanwhile, Samsung sold only 1.5 million smartphones in the quarter.

(SORUCE: ENGLISH.CHOSUN.COM)