Analysts at Korea Investment & Securities say that they expect global handset shipments to rise 16.2% YoY to 1.16 billion units for 2007. Although most market researchers at the beginning of the year forecast the handset market would grow around 10% in 2007, modest growth has held up throughout the year. They believe robust growth will continue in 2008 and that global handset shipments will likely display double-digit growth of 11.8% YoY to 1.3 billion units in 2008F.

New demand (especially Asia-Pacific) and replacement demand for smart phones in Europe and North America will drive growth for the year.

In 2007, the top four handset makers are seeing their positions improve against the demise of Motorola. In particular, Samsung Electronics and LG Electronics look set to enter a golden cycle with greater shipments and better profitability YoY. In 2008, while Nokia will fortify its number one position, Samsung Electronics and LG Electronics will make advances.

Samsung Electronics handset shipments should swell 40.8% YoY to 230 million units in 2008F. The operating margin will rise from 11% in 2007 to 12.5% in 2008F as the smart phones' share will rise to 20%. For LG Electronics, its 2008F handset shipments should soar 28.8% YoY to 100 million units and the operating margin will jump from 8.5% in 2007 to 8.7% next year thanks to a beefed-up product line with value-added products - smart phones and designer phones.

To the contrary,  Korea Investment & Securities expects that Sony-Ericsson will find it hard to operate as demand for Walkman phones started to fall and new models are not released in a timely fashion. The loss-making Motorola also will have a hard time with a weak product lineup.

On the web: Korea Investment & Securities

Posted to the site on 21st November 2007

Posted to: www.cellular-news.com/story/27585.php