BOSTON — Mobile telephone handset shipments increased 16 percent in the first quarter of 2003 compared to the first quarter of 2002. However, most handset vendors profits were squeezed in the competitive market, according to market research company Strategy Analytics Inc.
Strategy Analytics maintained its projection of 455 million units to be sold in 2003.
Shipments to the Europe-originated GSM standard grew 13 percent and market leader Nokia reaped the benefits. Nokia's total shipments grew 18 percent, while expanding profits nearly two percentage points year-on-year.
Shipments to the U.S.-originated CDMA standard grew 49 percent year over year on strength in the Americas markets. South Korean vendors Samsung Electronics and LG Electronics benefited from this and LG recorded 81 percent shipment growth and revenue growth of 41 percent, allowing it to overtake Sony-Ericsson in the global rankings.
But shipment growth does not equal profitability, said Chris Ambrosio, director of the wireless device strategies service at Strategy Analytics.
With the exception of Nokia, vendor profits were flat or declining. Shipment growth for the top 6 vendors was slightly faster than the market rate at just under 19 percent, but profits grew only 3 percent.
The rankings are now Nokia, Motorola, Samsung, Siemens, LG Electronics and Sony-Ericsson, with Nokia outselling Motorola by more than two to one.
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