Symbian Maintains Market Share, Swings into Profit

Strategic Insights -

Symbian, the UK-based mobile phone software company, has remained resilient under pressure from Microsoft, while simultaneously swinging into profit in the first half of the year. The company, majority-owned by leading mobile phone manufacturers such as Nokia, has seen a significant increase in revenues, rising from £51.6m in the first half of 2005 to £80m in the six months to June 30. A notable increase in royalties, from £41.6m to £73.4m, has contributed to the company's profitability.

Key Takeaways:

  • Symbian's revenues increased from £51.6m in the first half of 2005 to £80m in the six months to June 30, a rise of 55%.
  • Royalties accounted for £73.4m in the first half, compared to £41.6m in the same period last year, on a higher volume of shipments.
  • Consulting revenues accounted for a smaller share of the total.
  • The company is now profitable after eight years of losses, according to CEO Nigel Clifford.
  • Gross overheads remain at around £100m annually, as estimated by analyst Richard Windsor of Nomura.
  • First-half earnings before interest and tax were estimated at £26m by Mr. Windsor.
  • Shipments of "smart phones" equipped with new software have grown significantly, with 12.3m units shipped in the second quarter, a 58% increase from 7.8m in the same period last year.
  • Symbian's market share remains at 70% despite competition from Microsoft.
  • Symbian is working with its licensees to launch new products in direct competition with Microsoft.

Statistics:

  • Revenues rose from £51.6m in the first half of 2005 to £80m in the six months to June 30 (55% increase).
  • Royalties increased from £41.6m to £73.4m (77% increase).
  • Shipments of "smart phones" grew from 7.8m in the second quarter of last year to 12.3m this year (58% increase).
  • Gross overheads remain at £100m annually.
  • Estimated first-half earnings before interest and tax: £26m.

Sources:

  • Byline: Tom Braithwaite.
  • Symbian, the UK-based mobile phone software company.
  • Nokia.
  • Ericsson.
  • Sony Ericsson.
  • Panasonic.
  • Samsung.
  • Siemens.