Samsung reveals surge in operating profits, predicts slower smartphone rise

October 24, 2013
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Samsung has just released its third-quarter earnings report and, quite unsurprisingly, the figures show a strong quarter with a rise in the manufacturer's operating profits. Analysts, however, are concerned about the company's ability to surpass that in light of the very fierce competition in the mobile device industry.

The Korean manufacturer's operating profits from July to September rose to 10.16 trillion won, roughly $9.56 billion, up by 7% from the second quarter's 9.53 trillion won or $8.97 billion. The biggest source of earnings, of course, came from the company's IT and mobile division, its smartphones, bringing in profits of 6.70 trillion won, around $6.3 billion. Interestingly, this rise in smartphone profits is attributed mostly to Samsung casting an extremely wide net with a large variety of cheaper Android-powered Galaxy devices instead of putting everything in the high-end smartphone basket.

But Samsung's biggest growth rate actually came from its chip manufacturing business, specifically from its DRAM and NAND mobile memory chips. That business clocked in profits of 2.06 trillion won, $2.45 billion, twice the amount from the same period last year and so far its highest in three years. Samsung predicts shipments of its chips will stay strong and demand will go even higher as manufacturers try to churn out more devices for the holiday season.

samsung-3q-2013-operating-profits

This may be Samsung's record profit so far, but analysts wonder if Samsung will be able to maintain its winning streak, likening it to Nokia who has peaked in its market share and has gone downhill since. Samsung is indeed facing a tough road ahead and the company knows it, projecting slower smartphone growth in the months ahead due to the coming season when competition between smartphone manufacturers dramatically increases.

Download: Samsung Earnings Report (PDF)
SOURCE: Reuters


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  • Low IQ

    The economy of Tech as good as it is considering that it is coming to a big hurdle because of philosophy of how the mathematics of economics versus an ideology of politics does not mix or work in a realistic way for profits of innovation, because of this, it must work fervently against political ideology and it’s obvious irrationality against the mathematics.
    It then becomes an action or reaction of ineptitude resulting from the political ideology!, it is truly sad for those who understand the results from it!, and so we need to suffer and regress from the progressive thinking. If this was not so damaging to the economy it could only be viewed as comedic at best or sacrilegious of logic of which mathematics is derived from. No matter what you can personally have as an ideology, it then becomes futile when you try to push a square peg in to a round hole. Ideology and philosophy should be left in the classrooms of those who beliefs try to alter the realities of our physical world. I am just posting my frustrations against those ideologies which hamper progress of technology and innovation of who often the political ideology considers their enemies!