Smartphones drive Samsung to stronger than expected Q3
Analysts impressed by a "big surprise on the smartphone side", which compensated for declines in memory chips and displays
Published: 7 October, 2011
READ MORE: Financial | South Korea | Samsung | Handset
Despite Apple's best efforts, Samsung's Galaxy smartphones drove the Korean giant to better than expected profits in the third quarter. Demand for the handsets outweighed declining sales in other key business units, notably displays and semiconductors.
Operating profit in the three months to September was KRW4.2 trillion ($3.6bn), more than the KRW3.7 trillion anticipated by analysts, though down on the year-ago figure of KRW4.86 trillion. The figures are preliminary - audited results will be published later in the month and could change the profit figure by KRW200bn up or down. Sales were up 1.9% year-on-year to KRW31 trillion.
"I'm quite amazed," Lee Seung Woo of Shinyoung Securities told Bloomberg. "It seems like there was a big surprise on the smartphone side."
Samsung watchers believe profit at the telecoms unit, whose biggest business is handsets, was up 76% year-on-year to KRW1.99 trillion, on sales up 28% to KRW14.21 trillion. It is estimated that Samsung shipped about 30m smartphones during the third quarter, half of its overall target of 60m for the year. Anticipating strong results, the mobile division chief, JK Shin, said recently that he was confident the firm would hits its target of selling over 300m handsets in 2011.
Profit at the semiconductor division, Samsung's biggest business by revenue last year, fell 63% to KRW1.26 trillion and sales may have fallen to KRW8.98 trillion from KRW10.66 trillion a year earlier amid weakening demand for memory chips. Samsung has 40% share of the DRAM segment.
Samsung's Android rival HTC also revealed unaudited third quarter figures, boasting a 68% year-on-year rise in net income to NT$18.6m ($615.3m) on sales up 79% to NT$135.8m. However, this just missed the firm's target for 10% sequential growth, with revenues up only 9.2% on the second quarter. HTC is also being driven primarily by strong demand for high profile, highly specified Android smartphones, although it is also the leader in Windows handsets.
More FINANCIAL News
More SOUTH KOREA News
More SAMSUNG News
- Galaxy SIII pre-orders now pegged at 9m - May 21
- Samsung Focus 2 arrives at AT&T - May 21
COMMENTS
Carrier Broadband Performance: Africa & Middle East
Carriers are using mobile broadband as their weapon of choice in the fight against the commoditization of voice and falling ARPU. This...
Voice over LTE: Market Analysis and Forecasts
VoLTE offer unique advantages in lowering a carrier's voice infrastructure economics and promises to improve voice quality, device...
Satellite Phones: Will Dual Mode Help the Phoenix Rise from the Ashes?
Satellite phones have followed an arduous path since their much-hyped launch more than a decade ago. The hype was followed by an e...
