Galaxy series phones catapult Samsung to record quarter

Nathan Pensky · January 6, 2012 · Short URL:

Samsung Q4 revenue estimated at $41B, operating profits increase 73%

If there was any doubt that Samsung's mobile division had a pretty good 2011, we can put those doubts to bed. Samung reported Friday record earnings, on account of huge sales of its widely popular Galaxy series phones, as well as the one-time influx from the sale of their hard-disk drive company to Seagate Technology for $1.4 billion.

The South Korean firm did not disclose these figures officially. So, the figures are actually an estimate of what the company plans to announce.

Smart phones sales from the South Korean company were posted at a record 35 million in Q4, up 25% from the previous quarter. Q4 revenue is estimated at $41 billion Samsung's operating profits increased a whopping 73%, at $4.5 billion. Samsung said it would provide detailed reports at the end of January.

As striking as these proejections sound, they shouldn't be too surprising, given the numbers that have been rolling in since December, when Samsung reported having shipped 300 million phones to retailers, passing Apple to take the top spot among mobile phone manufacturers.

Samsung estimates it sold about 32 million smart phones in Q4, up from an estimated 27.8 million smart phones in Q3. These numbers were no doubt bolstered by the company's release of the Galaxy S II which launched in May and which reached the 10 million sold benchmark faster than any other phone in the company's history.

Samsung's record-breaking Q4 earnings will overtake their previous best quarter ever, posted in Q2 2010, at $4.5 billion. The company had only started selling mobile phones in 2010 but has quickly overtaken the market.

Meanwhile, another big Asian mobile manufacturer HTC has projected its first quarterly losses in two years, having faced stiff competition from Samsung and Apple mobile products. Q4 net income for HTC is projected to drop 26% from the previous year, to $364 million, with revenue dropping 2.5%. HTC's shipments of smart phones fell from 10 million units in Q3 to an estimated 8.5 million in Q4.

One report claims that HTC's failings in their smart phone sales may have to do with flooding the market with too many models, the upgrades of which are not transparent to the average consumer. As opposed to Samsung, whose much-anticipated new Galaxy S II model launched this year to huge popular demand, upgrades for HTC's Sensation, Rhyme, and Wildfire models were confusing even to experts in the field.

Also cited in HTC's slow earnings were, of course, continued interest in Apple handset products, and general recession woes.

[Image Credit: Reuters]

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