Samsung Outsold Apple During iPhone 5 Launch Quarter

Samsung Outsold Apple During iPhone 5 Launch Quarter

For the past few years, smartphone giant Samsung has routinely outsold its closest rival, Apple, in every quarter except those in which Apple launched a new iPhone. But Samsung overcame its annual defeat in Q4 2012, selling more smartphones than Apple despite the launch of the iPhone 5.

Samsung is the world’s biggest seller of smartphones by a wide margin. In Q4 2012 alone, the firm sold about 62 million smartphones, thanks largely to huge demand for its Galaxy S III and Galaxy Note II. According to analyst estimates, Samsung sold 15 million Galaxy S III and about 8 million Galaxy Note II smartphones in the quarter.

Samsung also benefited from “slower-than-expected sales of Apple’s iPhone 5,” according to one analyst. Apple sold about 45 million smartphones during the quarter, a number that was elevated due to the launch of the iPhone 5. But Apple also sells older devices like the iPhone 4S and iPhone 4 at huge discounts to bolster sales, and some believe that these older devices actually command a huge percentage of overall iPhone sales. The iPhone 4 is over two years old.

Apple has good reason to flood the market with cheaper, older products: While it releases just one new smartphone each year, Samsung and its other competitors release multiple new smartphones annually. And though Samsung launched only one major new smartphone in the fourth quarter, the Galaxy Note II, it released almost 40 models throughout calendar year 2012. (LG released 24 smartphone models in 2012, followed by HTC with 18 and Nokia with 9.)

Multiple models don’t guarantee success, however. HTC this week announced its poorest quarterly results since 2006, with profits falling for the fifth consecutive quarter.

But Samsung is clearly doing something right. The firm posted record quarterly profits of $8.3 billion, a jump of 89 percent year over year, on $50 billion in revenues in the quarter—an 18 percent improvement. The firm also makes products such as microprocessors, display screens and TVs, computers, and other electronics. But analysts estimate that Samsung’s smartphone business alone doubled earnings to roughly $5 billion.

Samsung currently controls 31 percent of the smartphone market, according to IDC, compared with 15 percent for Apple and 4 percent for HTC.

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