Samsung posts record profits as smartphone sales soar

Samsung has almost doubled its profits in its third quarter of 2012, thanking the performance of its smartphone division for the significant rise.

Net profit for the three-month period hit KRW6.56tn (£3.7bn), which represented a 91% year-on-year rise.

The mobile communications business – responsible for products like the Samsung Galaxy SIII and the Galaxy Note tablet – recorded KRW26.25tn in sales and represented more than half of the company’s overall revenue.

The display panels business – which sells screens to rival mobile manufacturer Apple – posted sales of KRW8.46tn, showing a 19% rise from the same period last year.

“The business environment remained difficult with global economic uncertainties persisting amid the fiscal concerns in the US and Europe,” said Robert Yi, senior vice-president and head of investor relations at Samsung. “However, we continued to break our quarterly profit records.

“We will do our best to sustain our earnings momentum throughout the fourth quarter by implementing strategies we have developed for our businesses.”

Samsung says the upcoming Christmas season will boost sales even further, ensuring demand for its mobile phones and tablets. However, it warned its PC DRAM division – which saw sales fall from KRW5.5tn to KRW5.2trn in the last quarter – would continue to underperform.

Samsung also warned its digital appliance business would slow down thanks to unfavourable market conditions in developed economies.

The results from Samsung coincided with the publication of a report from analyst firm IDC, reaffirming the mobile manufacturer’s position as the leading smartphone vendor.

The report claims Samsung holds a 31.3% market share, with its closest rival Apple only holding 15%. The figures said the company shipped 56.3 million units in the third quarter – again significantly higher than second place Apple’s 26.9 million number – and its year-on-year growth was over 100%.

Nokia has disappeared from the top five smartphone vendors following its change in tack, moving from the Symbian mobile operating system (OS) to Microsoft’s Windows Phone OS.

The overall smartphone market grew by 45.3% year-on-year, showing shipments of 179.7 million for the three-month period.