According to the latest research from Counterpoint Market Monitor, Global handset profits grew 4% annually in Q2 2018 mainly due to Chinese brands, which were aggressive with their flagship offerings. Their combined profits crossed US$ 2 billion for the first time, contributing to almost a fifth of the total handset profits.
Counterpoint expects the average selling price of smartphones to increase, driven by developed markets. However, smartphone volumes are likely to be flat as consumers are now keeping smartphones for longer. This will have implications for OEMs’ revenue as OEMs are looking to maximize their profits by increasing their average selling price and entering new price tiers.
Apple remains the most profitable smartphone brand. iPhone X, which drove a new design language, helped Apple command a significantly higher Average Selling Price (ASP) during the second quarter, at a point when the overall smartphone market was beginning to saturate.
Apple is followed by Samsung 17% and Chinese brands: Huawei (8%), OPPO (5%), vivo (4%) and Xiaomi (3%) were the key Chinese players which grew during the quarter.
The remaining 1% of total industry profit was distributed among more than 600+ handset brands.
Samsung’s profit declined 21% annually due to weaker than expected sales of the Galaxy S9 series. The Galaxy S9 series shipments declined 24% in Q2 2018 as compared to Galaxy S8 series in Q2 2017.
Xiaomi (747%), Huawei (107%), vivo (24%) and OPPO (23%) were the fastest growing smartphone brands in terms of handset profits during Q2 2018.
It it worth to mention that the Indian smartphone market is currently the main battleground for many handset manufacturers from China, Taiwan and South Korea. While smartphone shipments have slowed in many parts of the world, the Indian mobile phone market continues to grow.