1/28/2009 2:42:00 PM
Apples iPhone sales increase as Nokia's profits fall
TURBULENCE in the manufacturing sector continued this week with more evidence that the established players will be challenged by the likes of Apple.
Apple reported that iPhone sales were up 88% in Q4 2008, compared with the same period in 2007. It also saw a record net profit of $1.61bn (£1.15bn) and record revenue of $10.7bn (£7.8bn) for the quarter ending in December.
However, Nokia saw its profits tumble to £542m in Q4 last year – a 69% fall ?on the £1.73bn it made in profits for the final quarter of 2007. Sales also fell 19% to £11.9bn, from £14.8bn in Q4 2007.
The manufacturer issued further gloom with expectations that its global handset volumes will drop by 10% in 2009 compared with 2008.
The contrasting fortunes of Apple and Nokia mark a trend for many observers, with a new clutch of manufacturers (Apple, RIM and HTC) giving the ‘old order’ of Nokia, Sony Ericsson and Motorola a fright.
Earlier this month, Sony Ericsson reported a fall in handset shipments to 24.2 million in Q4 2008. Meanwhile, Motorola – which will report its results at the start of February – is set to cut 4,000 jobs on top of the 3,000 it announced in 2008, in a desperate attempt to cut costs.
In comparison, LG has overtaken Sony Ericsson and Motorola following an 8% increase in handset shipments to 25.7 million in the fourth quarter of 2008, and is now the world’s third top handset manufacturer. It also sold a record number of units in 2008 – 100.7 million, compared with 80.5 million units one year earlier.
Analysts said LG could gain from the turmoil hitting rivals, such as Nokia and Sony Ericsson, as it starts to produce more mid to low mass-volume devices alongside feature-packed models and smartphones.