Samsung Leapfrogs Apple as the Most Profitable Smartphone Maker

The South Korean handset manufacturing company has become the world’s most profitable handset vendor in the second quarter of this year steering past its rival Apple. Apple stood on top of the ladder for almost four years, which reigned from the third quarter of 2009 to the first quarter of 2013, before relinquishing it’s superiority to Samsung in the second quarter.

A more worrying issue concerning Apple is its lack of sales overseas. Sales of its products in China came down $3.6 billion every quarter. Sales in the European and the Asian market have also going slow. Without introducing a cheaper, alternative version of its iPhone, it is likely that the Apple international market share will continue to fall short as affordable Android phones continue to improve in stature.

Samsung’s global handset hit profits up to $5.2 billion this quarter as stated by Strategy Analytics. Apple’s market profit had reached $4.6 billion on the other hand. Samsung’s handset sector posted a profit of $5.6 billion in the second quarter as the difference seemingly came from the non-handsets.

Apple’s global smartphone market share has seen a fall from 17% to 14%, which is the lowest for three years, while Samsung’s share climbed up 33%. Samsung had sold over 76 million devices in this quarter, more than double of Apple’s 31 million.

The company’s strong volumes, high wholesale prices, and tight cost controls has contributed significantly towards its success.  Apple, meanwhile, is facing heated competition from around the globe and might require changing its strategy.

Apple is now facing severe pressure to launch more iPhone models at a cheaper rate in order to keep the surging competition in the market at bay, and make up for the lost profits in the second half of 2013.