Apple Pips Nokia As Largest Handset Vendor By Revenue

by Gaurav Kheterpal on April 25, 2011

Apple and Nokia are currently standing at opposite ends of the tunnel. While the former’s revenues from iPhone rose to $11.9 billion in the last quarter, the latter’s smartphone revenues slipped to $9.4 billion. Apple recently reported strong financial results for its fiscal 2011 second quarter, raking in $24.67 billion in revenue and earning a net profit of $5.99 billion.

In contrast, Nokia is still desperately trying to find its feet on WinPho7. The much fancied MeeGo became history before it could make an impact. And Symbian seems only a matter of short term appeal. Nokia plans to stem the tide by launching dozens of devices targeted across all demographics and continents.

As per a recent report from Boston-based Strategy Analytics, Apple passed Nokia during the first quarter to become the world’s largest vendor of mobile phones in terms of revenue. With the iPhone 5 rumored to launch in September, the good news just doesn’t stop for Apple. In contrast, Nokia needs to revive the volume game sooner than later or else it might be too late to make its WinPho7 deal count.

Apple’s achievements gain more prominence if you consider that it’s single device, carrier exclusivity strategy managed to beat Nokia’s eat-all-you-can range of smartphones and everybody-is-welcome operator strategy. Apple sold 18.65 million iPhones last quarter, up from the 16.24 million in the previous quarter. It’s no mean achievement that the iPhone made up for more than half of Apple’s $24.67 billion in revenue from the entire quarter.

In contrast, Nokia shipped 108.5 million handsets last quarter, with 24.2 million of those being smartphones. Though Nokia is still a formidable force as far as volume is concerned, its revenue per phone is a miserly $87 per phone. In contrast, the iPhone is a cash cow for Apple, fetching nearly $638 per device. Overall, it’s believed that Apple’s iPhone business, is now worth $12.3 billion. In contrast, Nokia’s total of $9.6 billion in sales. Apple is still no match for Nokia in terms of volume though.

Interestingly, the Strategy Analytics report predicts that Apple’s honeymoon would be shortlived. The firm mentions

“Rivals are chasing hard, particularly the Android vendor community, whose global installed base of smartphones we estimate will exceed that of Apple’s by the end of 2011. Nokia is also investing heavily with Microsoft and Apple will be a key target for them next year.”

The predictions are similar to those made by an IDC report claiming Microsoft’s Windows Phone platform will surpass the iPhone in worldwide smartphone market share by 2015. However, the truth of the moment remains iPhone sales for Apple continue to grow at an astronomical rate. With iOS 5.0 and iPhone 5 in the works, Apple’s surely in no mood to rest on its current laurels.

As Steve Jobs recently mentioned

“We’re firing on all cylinders. We will continue to innovate on all fronts throughout the remainder of the year.”

Good Luck to Android and WinPho7 – catching up with the iPhone isn’t going to be easy.

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Written by: Gaurav Kheterpal. www.digitcom.ca. Follow TheTelecomBlog.comby: RSS,TwitterFacebook, or YouTube.

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