Samsung estimates record second-quarter profits of $5.9 billion

Posted:
in General Discussion edited January 2014
Driven by sustained growth of its smartphone segment, Samsung has provided guidance for record profit of $5.9 billion from its June quarter.

The Korean electronics maker provided an initial estimate for its quarterly performance ahead of the complete results due later this month, Reuters reported on Thursday. The company tentatively reported revenue of 47 trillion won ($41.5 billion), slightly less than a forecast of 50 trillion won.

Samsung's estimated profit of 6.7 trillion won ($5.9 billion) tops its previous record of 5.85 trillion won, which came in the first quarter of this year. Wall Street consensus projections compiled by Reuters had averaged expectations of 6.67 trillion won in profits.

Galaxy smartphone sales have helped Samsung reach its new heights. Samsung's most-recent flagship phone, the Galaxy S III, launched in Europe in May, while overwhelming demand for the device led to delays in its U.S. launch. The company said last week it expects to sell 10 million Galaxy S III units in just two months of availability.

Galaxy


Rival Apple actually sought to block the U.S. launch of the Galaxy S III as part of its patent battle with Samsung, but it was unsuccessful in obtaining an injunction. The iPhone maker did, however, succeed in winning preliminary injunctions against the Galaxy Nexus smartphone and the Galaxy Tab 10.1 tablet.

Samsung and Apple have developed a neck-and-neck rivalry in the smartphone market as the two have traded positions as the world's largest smartphone maker from quarter to quarter. Recent estimates pegged Samsung as the leader during the March quarter.
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Comments

  • Reply 1 of 41
    quadra 610quadra 610 Posts: 6,757member


    The sad part is that Samsung won't be able to pay any of this to their R&D department. 


     


    Because it's not actually part of the company. It isn't even in the same country. 


     


    It's here:


     


    1 Infinite Loop


    Cupertino, CA


    95014


    USA

  • Reply 2 of 41


    Samsung is firing on all cylinders.

  • Reply 3 of 41
    solipsismxsolipsismx Posts: 19,566member
    Samsung is firing on all cylinders.

    And drafting the lead car.
  • Reply 4 of 41

    Quote:

    Originally Posted by SolipsismX View Post





    And drafting the lead car.


    True.

  • Reply 5 of 41
    anantksundaramanantksundaram Posts: 20,405member


    That's a 14% profit margin, slightly less than half of Apple's ~30% (mrq).


     


    They are certainly doing well at the low end, it would seem. Good for them! Someone needs to serve that market segment as well.

  • Reply 6 of 41

    Quote:

    Originally Posted by anantksundaram View Post


    That's a 14% profit margin, slightly less than half of Apple's ~30% (mrq).


     


    They are certainly doing well at the low end, it would seem. Good for them! Someone needs to serve that market segment as well.



     


    I think their Galaxy S series is on the high end.  Their other businesses surely pull down the profits.

  • Reply 7 of 41
    poochpooch Posts: 768member
    it's reports like these that always make me happy to remember something steve during a presentation. i can't remember the specifics (like when or where, exactly), but it was sometime around the beginning of 2010 i think. he said something along the lines of "we're a 50 billion dollar a year company" (referring to revenue). what he accomplished is as remarkable now as it was then.
  • Reply 8 of 41

    Quote:

    Originally Posted by anantksundaram View Post


    That's a 14% profit margin, slightly less than half of Apple's ~30% (mrq).


     


    They are certainly doing well at the low end, it would seem. Good for them! Someone needs to serve that market segment as well.



    Agreed...I remember when Nokia dominated the "Low end," too! :) 

  • Reply 9 of 41
    vadaniavadania Posts: 425member
    solipsismx wrote: »
    And drafting the lead car.

    I had to look that one up, but excellent analogy!
  • Reply 10 of 41

    Quote:

    Originally Posted by Quadra 610 View Post


    The sad part is that Samsung won't be able to pay any of this to their R&D department. 


     



     


    Facts being facts via public financials, you do realize Samsung spent 9 billion in R&D last year compared to about 2.5 billion by Apple, right? That doesn't include the 22.5 billion they are estimated to spend this year on fabrication and facilities upgrades.


     


    By all means hate on Samsung to your little hearts content, but the snarky stupidity seems immature and devoid of any factual backing. 

  • Reply 11 of 41
    solipsismxsolipsismx Posts: 19,566member
    That doesn't include the 22.5 billion they are estimated to spend this year on fabrication and facilities upgrades.

    Define fabrication. ????
  • Reply 12 of 41


    Good points.  Many of the critical components in products Apple have been from Samsung.  Displays, memory, etc.   They are an awesome force in personal electronics.

  • Reply 13 of 41
    macbook promacbook pro Posts: 1,605member
    pooch wrote: »
    it's reports like these that always make me happy to remember something steve during a presentation. i can't remember the specifics (like when or where, exactly), but it was sometime around the beginning of 2010 i think. he said something along the lines of "we're a 50 billion dollar a year company" (referring to revenue). what he accomplished is as remarkable now as it was then.

    The quote is "If you annualize our quarterly revenue, it's surprising that Apple is now a $50+ billion company." (1)


    An interesting note is:

    "... The Company [Apple] posted record quarterly revenue of $46.33 billion and record quarterly net profit of $13.06 billion..." (2)

    "... The Company posted quarterly revenue of $39.2 billion and quarterly net profit of $11.6 billion..." (3)

    "... Peter Oppenheimer, Apple’s CFO stated that “Looking ahead to the third fiscal quarter, we expect revenue of about $34 billion." (3)


    Apple announced almost $50 billion in revenue in one quarter of fiscal year 2012 and appear to be headed upwards of $150 billion for fiscal year 2012 with profits likely to reach $40 billion.



    1. Prince McLean 25 January 2010. Steve Jobs: Apple a $50B company, excited over 'major new product'. Apple Insider. Retrieved 5 July 2012.
    2. Unattributed. Published 24 January 2012. Apple Reports First Quarter Results. Apple. Retrieved 5 July 2012.
    3. Unattributed. Published 24 March 2012. Apple Reports Second Quarter Results. Apple. Retrieved 5 July 2012.
  • Reply 14 of 41
    anantksundaramanantksundaram Posts: 20,405member
    I think their Galaxy S series is on the high end.  Their other businesses surely pull down the profits.

    Yeah, you think.

    I could tell you "I think" the opposite is true, and you would have no way to counter it one way or another.

    Just get used to the fact that Samsung caters to the low end. Nothing wrong with that. Someone has to do it.
  • Reply 15 of 41
    poochpooch Posts: 768member
    Quote:
    Originally Posted by MacBook Pro View Post



    The quote is "If you annualize our quarterly revenue, it's surprising that Apple is now a $50+ billion company." (1)


    [...]

    1. Prince McLean 25 January 2010. Steve Jobs: Apple a $50B company, excited over 'major new product'. Apple Insider. Retrieved 5 July 2012.

     

    thanks! (i would swear that i heard him verbalize it somewhere.)

    http://www.apple.com/pr/library/2010/01/25Apple-Reports-First-Quarter-Results.html
  • Reply 16 of 41

    Quote:

    Originally Posted by anantksundaram View Post





    Yeah, you think.

    I could tell you "I think" the opposite is true, and you would have no way to counter it one way or another.

    Just get used to the fact that Samsung caters to the low end. Nothing wrong with that. Someone has to do it.


     


    But you would be wrong to think that. 

  • Reply 17 of 41
    macbook promacbook pro Posts: 1,605member
    pooch wrote: »
    thanks! (i would swear that i heard him verbalize it somewhere.)http://www.apple.com/pr/library/2010/01/25Apple-Reports-First-Quarter-Results.html


    If you were listening to the earnings call then no doubt you did hear him say that. As you can see from my post the statement by Steve Jobs was of sufficient interest to use as the lead for the story.

    I was more interested in noting that Apple is now nearly a $50 billion per quarter company. Your post reminded me of that fact.

    But you would be wrong to think that. 


    Should be easy to prove his statement incorrect. I'll wait ...
  • Reply 18 of 41
    nikon133nikon133 Posts: 2,600member

    Quote:

    Originally Posted by Minnesota_Steve View Post


     


    But you would be wrong to think that. 



     


    While S3 is high-end product, Samsung's production covers from cheapest feature phones, across entry level (cheap) Androids like Galaxy Mini and Ace... not to mention other electronics they are making. Without high end exclusivity, their image will never reach the one of Apple, even if their profits do.


     


    I'm not holding that against Samsung, just saying. S3 is attractive to me (or not) regardless of Samsung's image.

  • Reply 19 of 41

    Quote:

    Originally Posted by thataveragejoe View Post


     


    Facts being facts via public financials, you do realize Samsung spent 9 billion in R&D last year compared to about 2.5 billion by Apple, right? That doesn't include the 22.5 billion they are estimated to spend this year on fabrication and facilities upgrades.


     


    By all means hate on Samsung to your little hearts content, but the snarky stupidity seems immature and devoid of any factual backing. 



     


    Lots of people like to take Apple's R&D spending and try to spin it to look like they are somehow deficient. It's simply not true.


     


    That $9 billion Samsung spends is divided up among hundreds of products from the actual components (DRAM, NAND, LCD panels, OLED panels, processors, lithium batteries, hard drives) to end user products (mobile phones, tablets, laptops, desktops, digital cameras, televisions, home theatre and on and on).


     


    Apple's $2.5 billion is divided up between a small handful of products. In terms of R&D spending vs the number of products, Apple is far higher than Samsung.


     


    Another metric people like to use is R&D as a percentage of revenue. This is one where Apple again appears to be behind since they spend such a small portion of their revenue on R&D. The other way to look at it is that Apple gets a far better return on their R&D investment than other companies do. Designing a small number of highly successful products is what makes Apple so profitable. In contrast to Samsung who decides to take the shotgun approach (28 models of smartphones and 90+ models of televisions) and therefore get a much lower rate of return for their R&D.


     


    Hate on Apple all you want, but the facts speak for themselves. Apple is the most efficient, streamlined and profitable technology company in the world.

  • Reply 20 of 41
    tooltalktooltalk Posts: 766member

    Quote:

    Originally Posted by Pooch View Post



    it's reports like these that always make me happy to remember something steve during a presentation. i can't remember the specifics (like when or where, exactly), but it was sometime around the beginning of 2010 i think. he said something along the lines of "we're a 50 billion dollar a year company" (referring to revenue). what he accomplished is as remarkable now as it was then.


     


    Samsung's 2Q revenue is $41B..  At this rate, Samsung will be a 200 billion dollar a year company in a year or two.

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