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It’s that time as smartphone manufacturers the world over tell their shareholders and legions of users how well they performed financially during the second quarter of 2012. For Samsung, I’d say they have plenty to write home even as the April – June 2012 period isn’t officially announced for the Korean manufacturer, a Reuters report shows Samsung will post a record profit of $5.9 billion. That’s thanks in no small part to sales of the exponentially expanding Galaxy series of devices indicating Samsung’s legal troubles aren’t hampering their bottom line thus far.
As the story turns to HTC, the picture gets a little less rosy as the Taiwanese company saw a 57.8 percent drop in net profit in the second quarter of this year. Blamed partly on custom issues inside the US and weak European sales, HTC’s small margins are hurting their short-term outlook. Despite globally rolling out the HTC One series, weak European demand along with heavy competition from Samsung and Apple are causing concerns for HTC’s financial health. HTC’s consolidated sales totaled T$30 billion, which was unchanged from May, but a 33.4 percent drop compared to June of 2011.
“HTC’s scale and margin are a lot lower compared to Samsung and Apple. It will see much pressure in the short to medium term,” said KGI securities analyst Richard Ko, adding he expected HTC to see limited growth in the second half.
One troublespot being highlighted by both Samsung and HTC is the troubling Eurozone market as they battle weak prices, demand and a Euro that isn’t stretching as far as it has in the past. Analysts predict that the third quarter of 2012 won’t show much improvement for HTC and Samsung will continue to ride on its strong handset sales even as other consumer electronic areas show weakening demand in Europe.
Reuters, Engadget, Reuters HTC