Global Smartphone Operating Profit Share in Q4 2014

The smartphone era will never come to an end. This isn’t just my prediction but I think even if tablets and wearables become popular, the smartphone will be a standard mobile device more than the two. Laptops are more preferred now over desktop computers. However, tablets are more preferred over laptops. But between a tablet and a smartphone, more people would go for a smartphone because it’s more portable and has more features than a tablet because of the call and text functions. Honestly, you can do almost anything on the smartphone now…even work!

A recent research by Strategy Analytics found out that global smartphone operating profit in the last quarter of 2014 reached $21 billion. That’s a lot of money but it’s interesting to note that Android captured only a small 11 percent share. This is a record-low by the mobile operating system while iOS hit 89% (from 71 percent) which is record-high in contrast.

Impressed with iOS now? Actually, I’m confused because all along I thought there are more Android devices all over the world. The operating profit increased to 31 percent from the previous year, same quarter. From $16.2 billion, Q4 profit reached $21.2 billion. However, Android saw a 29 percent loss for a lot of reasons. There may be a more Android phones all over the world now but the prices make the difference. Apple’s iPhones are still more expensive.

Apple iOS seems to be tigheting its grip on the smartphone industry according to Strategy Analytics’ Executive Director Neil Mawston. He noted “Apple’s strategy of premium products and lean logistics is proving hugely profitable” while “Android’s weak profitability for its hardware partners will worry Google”.

Right now, smartphone manufactures working on Android phones like Huawei or Samsung are not making much profit because there are smaller and newer companies introducing affordable or mid-range phones especially in the emerging market China. If this continues, they might be “tempted to look at alternative platforms such as Microsoft, Tizen or Firefox” as suggested by Mawston.

SOURCE: Strategy Analytics