Apple more profitable than Nokia

Apple surpassed Nokia in the third quarter of 2009 as the mobile phone maker with the highest operating profit.

According to Strategy Analytics (via Reuters) Silicon Alley Insider reports that Apple's operating profit was $US1.6 billion on sales of 7.4 million iPhones, generating revenue of $US4.5 billion.

Apple iPhone 3GS review

In contrast Nokia's profit margins are minute. Its profit was $US1.1 billion on sales of 108.5 million phones, generating revenue of $US10.36 billion (6.9 billion).

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The economic downturn and Nokia's lack of an American footprint are to blame.

Worldwide mobile phone sales totalled 286.1 million units in the second quarter of 2009, a 6.1 percent decrease from the second quarter of 2008, according to Gartner.

However, smartphone sales surpassed 40 million units, a 27 percent increase from the same period last year, representing the fastest-growing segment of the mobile-devices market.

"Given the higher margins, smartphones offer the biggest opportunity for manufacturers. It is the fastest-growing market segment and the most resistant to declining average selling prices," said Carolina Milanesi, research director at Gartner.

Nokia N97 review

Nokia's portfolio remained heavily skewed toward low-end devices. Its flagship high-end N97 smartphone met little enthusiasm at its launch in the second quarter of 2009 and has sold just 500,000 units in the channel since it started to ship in June, compared to Apple's iPhone 3GS, which sold 1 million units in its first weekend.

"The right high-end product and an increased focus on services and content are vital for Nokia if it wants to both revamp its brand and please investors with a more promising outlook in ASPs and margins," said Milanesi.

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