By Kim Yoo-chul
LG Electronics is better positioned to overtake Apple as the Korean firm's mobile business is expected to remain strong throughout this year, according to a leading market research firm, Friday.
"If LG Electronics can expand its retail presence and marketing in major countries such as the United States and China, the company could quietly start to challenge Apple for second position," Strategy Analytics (SA), a Boston-based consulting firm, said in an analysis report.
Such positive remarks for LG, the world's third largest smartphone vendor, come after the firm said its global shipments doubled year-over-year to 12.1 million units in the second quarter of this year.
LG captured a 5.3 percent share during the period ― the first time that it exceeded 5 percent share since the company started its smartphone business. It ranked third in sales volume for the second straight quarter.
"The popular Optimus and Nexus models have been the main drivers of LG's success," said SA analyst Linda Sui.
Data from SA showed Samsung was the firm leader with a 33.1 percent market share in the second quarter, followed by Apple with 13.6 percent, LG Electronics with 5 percent, ZTE and Huawei of China with 5 percent 4.8 percent, respectively.
LG earlier said it is seeking to sell 45 million smartphones this year. Some industry and LG sources said it could sell over 50 million units excluding low-priced feature phones.
"Apple's global smartphone market share is at its lowest level since the second quarter of 2010. The current iPhone portfolio is under-performing and Apple is at risk of being trapped in a pincer movement between rival 3-inch Android models at the low-end and 5-inch Android models at the high-end," SA wrote.
In a related note, Mark C. Newman from Sanford C. Bernstein in Hong Kong, revealed that the upcoming LG's premium G2 phone was already secured by all the major four operators in the United States as launch partners.
He stressed that the G2 will get considerably more operators around the world than those who sold its previous G or G Pro smartphones.
However, Fitch Ratings expects LG to face increased competition, meaning that profitability of its handset business could worsen in the second half of this year.
"This is because LG is highly likely to focus on volume growth to increase its weak smartphone market share. Therefore, marketing costs will continue to remain high and any additional market share is likely to come at the expense of margins," Fitch said in a statement.