Smartphone sales responsible for two thirds of Samsung’s record breaking profits in Q3 2012

October 5, 2012
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Samsung is going to report their Q3 2012 financial results on October 26th. Today though, they’re giving us a sneak peak as to how well their business is running. The company estimates that they’re going to earn roughly $7.3 billion in profit, which is almost double the profit from the same quarter a year ago. They’ve also said that Q3 2012 was the fourth straight quarter in which the company broke a profit record. The mobile phone unit is estimated to have contributed to roughly two thirds of the profits, which comes out to about $4.5 billion. Analysts say that the South Korean handset vendor shipped 58 million smartphones during the quarter, and that between 18 million and 20 million of them were specifically the Galaxy S III.

How does this compare to everyone else? Apple isn’t going to report their financial results until the 25th. Nokia, now the second largest handset maker, will report on the 18th. One thing that’s painfully apparent is that almost no one besides Samsung and Apple are making any meaningful amounts of money selling smartphones. Why’s that the case? Forgetting about Apple’s insane margins for a second, Samsung is in a very unique position as being one of the few companies that actually manufactures many of the components that go inside their devices. That translates to not only lower costs, but better supply chain management since parts can be shipped from one Samsung factory to another Samsung factory that does the actual assembly.

Looking towards the future, it’s safe to say that Q4 2012 is going to be yet another amazing quarter for the company. The Samsung Galaxy Note II is in the process of launching all around the world, and when it comes to America it’s going to be on all the major operators. That 5.5 inch beast is easily going to be the most expensive smartphone in Samsung’s portfolio, which means lots of revenue!

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