Samsung rings in record quarter

The smartphone wars are getting fiercer, as Samsung puts a record second quarter down to a massive boost in smartphone sales.

by Michael Northcott
Last Updated: 19 Aug 2013

The South Korean firm has recorded its best ever quarter, with profits soaring to $5.9bn, a whopping 79% increase on the same period the previous year. The firm says massive growth in sales of its Galaxy smartphones, as well as increased margins in its television sales are responsible for the lift. 

Samsung has long been in a battle with Apple, with both firms vying for the largest possible slice of the smartphone market, but analysts are seeing this latest set of results as a massive coup. Samsung overtook Nokia as the world’s largest manufacturer of phones earlier this year, with smartphones now accounting for around 60% of the firm’s profit.

If you look at the wider mobile phone market, including cheaper, more basic handsets, Apple is not a serious contender. According to Strategy Analytics, Samsung has just over 25% of the market, with Apple just 7.2%. But look specifically at the smartphone market and it’s a different story. Apple and Samsung have that market almost completely sewn up between them, although Samsung still shifted 50 million smartphones in Q2 this year – twice as many as Apple.

Despite Samsung’s lead however, the firm faces the threat of having models taken off shelves in several countries thanks to the patent disputes with Apple that are raging in dozens of places around the world. Apple is convinced that Samsung has copied the appearance of its iPad tablet PC too closely, and is attempting to close down Samsung’s sales in as many places as possible. Whilst this does not directly affect smartphone sales, tablet PCs are an exploding market and an increasingly important source of revenue for major electronics producers. 

Still, Samsung can breathe easy for the time being: record sales and profits will certainly keep shareholders happy. And with all that cash, they’ve probably got some pretty good lawyers dealing with those patent disputes, too… 

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