Samsung Q3 2013 profits rise thanks to cheaper smartphones

October 3, 2013
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Proving analyst estimates wrong, Samsung has shown a strong financial third quarter in its latest financial posting. This was largely due to more affordable smartphone models being sold in emerging markets.

In a partial earnings report, Samsung revealed that operating profits rose to 10.1 trillion won or $9.4 billion in the three months that ended in September. The same profits were recorded at 8.06 trillion won, roughly $7.5 billion, from the same period last year. In contrast, analysts estimated profits to be mediocre, only reaching 9.96 trillion won, around $9.3 billion.

The higher numbers were largely seen to be caused by the demand for cheaper smartphones in regions such as China, India, and the Middle East, in the face of the rising prices of high-end smartphones. Samsung has put out low-cost Galaxy smartphones, cheaper versions of flagships such as the Galaxy S4 Mini, and has continued selling slightly older models such as the Galaxy S III. In the Middle East, for example, the Mini and the S III outsold the iPhone 5 and even Samsung's own Galaxy S 4. Sales of the Galaxy S 4, on the other hand, which entered its first full quarter after its release in April, fell 18 percent.

Samsung hasn't released exact net income figures yet or a breakdown of the earnings, as those reports as still scheduled to follow later this month. But in light of third quarter sales reaching 59 trillion won, or $55 billion, analysts are already predicting an even better fourth quarter for the Korean manufacturer.

SOURCE: Bloomberg


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