Handset landscape remains fiercely competitive

With Q4 results recently announced for phone handset manufacturers, we now have an opportunity to take a clear view of the best performing providers and where the competition is most fierce.

Canadian telecommunication and wireless equipment company, Research in Motion Limited (RIM), saw its stock descend to a 52-week low last September, in what has been a poor year for the developer of the BlackBerry smartphone and tablet. Nevertheless, a recent surge in the share price demonstrated improved investor confidence in the release of the BlackBerry 10, despite a disastrous launch for the product. RIM’s timing could also be problematic due to rival Nokia - currently on the offensive. The world's largest vendor of mobile phones has seen its share price advance by 18% due to accelerated sales of its Lumia smartphone. This resulted in Nokia posting a profit of US$586 million for the final three months of 2012 against the backdrop of US$3.1 billion (€2.3 billion) losses throughout the year and a 22% decline in revenues.

Nokia remains in a similar position to RIM, with aggressive cost cutting obstructing their ability to fully provide a viable option to Google Android/Apple iOS, whose operating systems power 89% of all smartphones - according to the latest market data.

Meanwhile, broadly in line with what was expected, Samsung Electronics’ profits soared by 75.6% in Q4 due to sales of its flagship Galaxy S3 and Galaxy Note 2 smartphones. Yet Samsung remains cautious about continued accelerated growth in the global smartphone market, due to intensified competition and innumerable new products. Samsung is growing at a faster rate than Apple, and such growth is expected to continue. Samsung’s shares have climbed 12% over the past three months, while Apple’s have slumped by 20% due to lower-than-expected iPhone sales. Apple’s revenue also fell slightly short of what was expected, despite the company announcing record earnings of $54.5 billion for the last quarter, with 47.8m iPhones and 22.9m iPads sold.

Elsewhere, American multinational telecommunications corporation AT&T’s results for Q4 demonstrated a record 8.6m iPhone activations, of which the company was proud to announce that 16% were brand new AT&T customers. AT&T’s Android smartphone sales also hit an all-time high.


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