Samsung posts record sales; HTC first losses

Contrasting fortunes of Asian smartphone-makers indicates that success depends on wide product range

A Samsung employee holds a mobile phone at a Samsung display store in Johannesburg, October 3, (REUTERS/Siphiwe Sibeko )

The latest financial reports from South Korean electronics giant Samsung are reporting record operating-profit for the company.

Earnings from July to September this year rose 25 per cent to 10.1 trillion won (£5.8 billion), with slowing smartphone sales offset by high prices for memory chips.

The guidance report, released ahead of a full earnings report on 25 October, outperformed the expectations of experts, with a poll of 34 analysts by Thomson Reuters I/B/E/S previously predicting profits of 9.96 trillion won.

If Samsung’s predictions prove correct (and they usually do) then these revenues would represent a thirteen per cent increase from last year, putting paid to those doubting that Samsung can maintain its sales in the smartphone market.

But whilst demand for high-end devices like the Galaxy Note III or S4 might be slumping, Samsung’s strategy of offering devices at every price-point seems to be compensating for this.

The company currently sells more than 40 different handsets, with low and mid- range devices performing particularly well in the Middle East. Its older Galaxy S3 and Galaxy Mini handsets together outsold the iPhone 5 and Galaxy S4 in the region.

Providing a sharp contrast to Samsung’s fortunes are those of Taiwanese phone-manufacturer HTC. It posted a quarterly operating loss of T$3.5 billion (£74 million) with sales falling by a third compared with the same period last year.

Revenue has declined for the company for the last eight quarters with its failure blamed on a lack of products and advertising spend. Although the HTC One has been repeatedly lauded by reviewers, its release was delayed due to component shortages, and HTC’s attempts to target a lower price point with the HTC Mini have been belated at best.