Yesterday, Samsung showed off their earnings for the second quarter of 2013. They brought in quite a bit of cash, but did fall below expectations. Samsung posted a total operating profit of 7.7 trillion won (that’s about $6.9 billion), on sales 57.4 trillion won (about $51.5 billion). Compared to Q2 2013, in which they brought in 5.05 trillion won, that’s a big jump.
Notably, their operating profit from their IT and Mobile Communications division fell 3% year-over-year. They made 6.4 trillion won (about $5.6 billion). It made up 66% of group operating profit for the quarter.
“The strong growth streak for the smartphone market is expected to continue in the third quarter albeit at a slower pace.” Samsung stated in a press release. I have to say that I do agree with that. The smartphone market isn’t going to keep growing at the pace it has been over the past few years. Especially with manufacturers making less phones and specs starting to plateau recently.
Samsung does sell just about everything under the sun, but as we already noted, their primary business is selling smartphones and tablets. Similar to how Google’s main business is advertising. Samsung is still maintaining the highest share of all mobile phones shipped worldwide in the second quarter, at 28%. This is according to Strategy Analytics research that was released this week. The total smartphone shipments around the world grew 4% to about 386 million units, representing “the industry’s fastest growth for a year.”
Samsung is also sitting on a huge cash pile right now, just like Apple. For Q2 it reported $42.2 billion in free cash flow. Their cash postition has been increasing drastically, which leaves the question about how Samsung will release some of it to their shareholders. I’d definitely like to be a shareholder of Samsung.
So Samsung continues to rack in the cash, even with the smartphone market growing at a slower pace. Samsung is still going to make boatloads of money. But Maybe Samsung should hold off on releasing a new phone and tablet every week? What do you think about their earnings for Q2, surprising? Let us know in the comments below