Samsung profits nearly double on record smartphone sales | Business| Economy and finance news from a German perspective | DW | 27.07.2012
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Samsung profits nearly double on record smartphone sales

Bumper sales of its new Galaxy S3 smartphones have bolstered Samsung's position as world mobile phone leader. In addition, higher sales of PCs and TVs have powered the South Korean firm to a record profit.

Samsung's net profit surged to 5.2 trillion South Korean won (3.2 billion euros, $4.6 billion) in the second quarter of 2012 - up 48 percent from the same quarter a year ago, the technology firm announced Friday.

Driven by robust demand for its mobile devices and rising sales of its ultra-thin displays, revenue was up 21 percent to a record high of 47.6 trillion won.

The South Korean company reported profits in most of its divisions, including its display panel unit, which regained profitability on the back of stronger demand for tablet PCs and smartphones.

However, the company's chip manufacturing unit reported falling operating profit due to lower demand for desktop personal computers and a decrease in chip prices.

Samsung said in a statement it expected the third quarter to become "marginally positive" as it saw demand for consumer electronics goods to be rising. But it also warned of the potentially negative fallout of a worsening debt crisis in Europe.

"Continued fiscal instability in Europe and its effect on the global economy will result in the possibility of a slower than expected recovery and intensified market competition," said Samsung Senior Vice President Robert Yi in the statement.

Smartphones defy economic cooling

Market analysts are more bullish as they expect another record profit in the third quarter because of higher sales of Samsung's latest Galaxy S3 model.

"The mobile division alone will see an operating profit of 4.8 trillion won in the third quarter, helped by sales of the Galaxy S3 which will lead the firm's overall growth," Hanmag Securities analyst Y.B. Oh told the AFP news agency.

Samsung doesn't reveal precise sales figures for its devices. But market research firm Strategy Analytics said Friday the company had sold 50.5 million smartphones in the second quarter, thus increasing its market share to 34.6 percent, compared to 17.8 percent for its rival, Apple.

That included more than 10 million Galaxy S3 smartphones, Strategy Analytics said, which is part of the Android-powered Galaxy series.

Strategy Analytics also noted that Samsung had remained the world's biggest seller of all types of mobile handsets, with a 25.7 percent market share, compared to 23.1 percent held by Finnish mobile phone company Nokia.

Samsung unseated Nokia as world leader earlier this year.

uhe/ncy (AFP, AP, dpa)