Top Chinese Mobile Handset Brands Crossed a Combined USD 1 Billion in Operating Profits

Global mobile handset hardware segment generated USD 10.2 Billion in operating profits during Q3 2016. However, this was down 19% YoY as a result of the world’s leading smartphone brand Samsung saw almost USD 3 Billion operating profit being wiped out due to the Galaxy Note7 debacle.

For the first time top four Chinese brands generated combined $1.1 Billion in operating profits capturing a combined 11% profit share. The game of profits has always been between Apple and Samsung because of its strong presence premium segment and vertical integrated business model. However, over the last few quarters, there has been a strong competitive shift towards the Chinese brands which has generated healthy scale focusing on high volume mid- to high-tier segment by offering an attractive affordable premium portfolio.

Apple dominated with a significant 87% profit share during Q3 2016. Apple’s hold on the entire mobile value chain has consistently allowed Apple to command a higher premium for its iPhones leveraging its massive but loyal installed base of iPhone users.