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Asia Today ISSN 1861-4604 Wednesday, February 21, 2018

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Samsung Electronics records highest quarterly earnings of 8.1tn won

Samsung Electronics recorded its best-ever quarterly operating profit

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SEOUL - Buoyed by the sales of its Galaxy smartphones, Samsung Electronics recorded its best-ever quarterly operating profit, earning 8.1 trillion won ($7.3 billion) in the third quarter of 2012, almost double the 4.25 trillion won it made in the corresponding period last year.

The company released the numbers, but did not include its net profit or breakdown for each business group, ahead of its official earnings release on Oct. 26.

The third quarter results marks the fourth straight quarter of record profit.

The Korean electronics maker said the stronger-than-expected sales of its Galaxy smartphones sent operating profits up 90 per cent in the third quarter, offseting losses in other businesses.

Though Samsung doesn't report hard sales figures of its cell phones, analyst estimates put the number between 58 and 60 million.

As many as 18 to 20 million of those unit sales are Samsung's flagship Galaxy S III smartphone, which has been on sale since May.

While smartphone profits zoomed, those from its DRAM (dynamic random access memory) chip business dropped 14 per cent during the third quarter. Demand for its laptop and other computers also witnessed a dip.

Analysts have warned that Samsung results could take a hit in the coming months as it books legal damages owed to Apple.

In August, the U.S. District Court for the Northern

District of California ordered Samsung to pay more than $1bn in damages to Apple after the US electronics goods major accused Samsung of violating several of its design and software patents.

Samsung has now called for a retrial.

Apple subsequently asked for a permanent injunction against sale of Samsung phones including the Galaxy S III, while Samsung has launched lawsuits against Apple products including the iPhone 5.

The US court is expected to finalize its verdict in December.

"Fourth-quarter earnings will depend on how much Samsung will (set aside) provisions for possible fines relating to a lawsuit with Apple," said James Song from KDB Daewoo Securities.

Backed by aggressive marketing prior to the iPhone 5 release, Samsung is expected to have shipped 57 million smartphones in the quarter, according to Jeff Kang, an analyst with Daishin Securities in Seoul.

Samsung probably sold 17 million units of its flagship Galaxy S III and 6 million of its Galaxy Note 2 smartphone-tablet hybrid that launched last week in Korea, estimates Won Seo, an analyst with Korea Investment and Securities.

In contrast, Apple said sales of its iPhone 5 topped five million in the first three days after its release.

In a research note, Seo said, "We lifted our estimates as robust Galaxy S3 sales should bolster handset sales and margins".

The Galaxy S III was launched in May, while the Galaxy Note 2 will be available in 128 countries this month.

The company is due to officially report full earnings later this month. more...

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