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Apple, Samsung Get 90 Percent of Smart Phone Profits

Samsung and Apple captured 55 percent of global smartphone shipments in the first quarter of 2012 and over 90 percent of the market’s profits, ABI Research says.

Other studies have found similar results. Apple and Samsung accounted for a stunning 95 percent of the handset industry’s profits during the fourth quarter of 2011, according to a study by Canaccord Genuity.

By itself, Apple accounted for 80 percent of the profits in the period. That isn’t the first report showing similar results, only the latest.

None of that makes Nokia’s challenge, and that of Research in Motion, any easier.

“At this point in the year, Nokia will have to grow its Windows Phone business 5000 percent in 2012 just to offset its declines in Symbian shipments,” says Michael Morgan, ABI Research senior analyst.

In fact, Nokia’s market value is now at $8.8 billion, 92 percent lower than where it stood when Apple released the iPhone and just above the price Microsoft paid in 2011 for Skype. Also, since Microsoft has made such a big bet on Nokia as a way to gain smart phone share, if Nokia falters, so does Microsoft’s strategy for gaining share in smart phones.

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