Huawei is now the world’s most profitable Android smartphone brand

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Months after overtaking Xiaomi Inc. as China’s number one smartphone vendor, Huawei Technologies Co. Ltd. has now emerged as the world’s second most profitable phone company, followed by Vivo Communication Technology Co. Ltd., and Oppo Electronics Corp., research firm Strategy Analytics said in a new report.

Shenzhen-based Huawei raked in just over $200 million in profit from smartphone sales during the last quarter, which gives it a 2.4 percent share of global smartphone operating profits, the report says. Vivo and Oppo follow with 2.2 percent shares of the market.

Apple remains by far and away the most profitable smartphone brand in the world, reaping $8.5 billion in profits in the last quarter, amounting to a massive 91 percent share of the market. The market as a whole was worth $9.4 billion in the third quarter, down from $13.5 billion in operating profits in the same period one year ago.

“Huawei, Vivo and OPPO have not only improved their smartphone product lineups this year, they have also enhanced their operational abilities and kept a tight lid on expanding distribution costs,” Linda Sui from Strategy Analytics wrote in the report.

Strategy Analytics put Huawei’s rise down to “an efficient supply chain, sleek products, and effective marketing.” In addition, it recognized that Vivo and Oppo have “delivered relatively healthy profitability due to disciplined pricing and soaring shipments across Asia.”

In the report, Sui noted that Apple’s continued ability to maximize pricing while minimizing production costs was “impressive,” adding that Chinese brands are all very far behind Apple’s seemingly insurmountable position in the market.

Strategy Analytics didn’t discuss Samsung Electronics Co. Ltd.’s fall from the list of top vendors, but it seems likely that the recent exploding battery caper was a major factor.