Amazon.com is notoriously secretive about the shipment numbers for its table Kindle Fire. That also happens to be a habit that rival bookseller and tablet purveyor Barnes & Noble picked up on too for its Nook device. Tablet top dog Apple is one of the few players that isn’t coy about handing out its digits, but when you’re king of the hill, who wouldn’t want to flaunt figures like these?
Thankfully, iSuppli has released its latest batch of estimates on the state of the tablet market as of the fourth quarter. The market-intelligence specialist estimates that Amazon shipped 3.9 million Fire tablets in that timeframe, promptly jumping to claim the silver medal with a 14% market share. The overall market grew from 17.4 million units to 27.1 million units, a 55% bigger pie. Apple’s shipments grew 39% to 15.4 million, but that growing base made Cupertino’s market share slip. Samsung’s 2.1 million tabs moved was just an 8% increase, while B&N’s units soared by 156% to 1.9 million tablets on the heels of its new Nook Tablet.
Interestingly, iSuppli analyst Rhoda Alexander said Apple’s biggest competitor was itself, as the iPhone 4S launch provided a competitor for prospective buyers’ disposable dollars. Alexander attributed the surge in Google Android tablets to the Fire and Nook, since other Android players were forced to cut prices to compete, helping to spur sales.
The researcher expects the iPad 3 demand to outstrip supply for several months once it’s released. With price competition heating up in the Android arena and threatening profitability, iSuppli expects vendors to start considering Microsoft Windows 8 more seriously, and thinks the tablet market will see a slew of Windows 8 and ARM Holdings-based tablets hit the market late this year.
Total tablet shipments for 2011 came out to 65.2 million, topping the company’s forecast of 64.7 million. Compare that to the 17.4 million overall shipments in 2010 and you’ll see 274% growth – in other words, shipments nearly quadrupled.
A clear winner of these developments is our top-pick G5 Entertainment, which is developing games for all of the platforms. As late as yesterday, G5 announced that it will enter the Nook platform and it is probably a fair guess that it will not take too long until they will enter the Windows platform as well. G5 Entertainment is a debt free company with an EBIT margin of around 35%, that has a strong track record and is expected to grow earnings by 80%. It is a unique opportunity to participate in the smartphone and tablet growth and its stock is trading a very conservative 12-months forward PE-ratio of 14x.
I am long G5 Entertainment and you should be too.