The company said that it expects to maintain “solid sales” through the third quarter with the launch of “a new large-screen flagship smartphone;” the Galaxy Note 7 will be announced shortly. Moreover, operating profit is up 18% on a year-over-year (YoY) basis, while the company experienced a 5% annual increase in its quarterly revenue. Samsung also aims to expand smartphone sales this year by launching new mid-range and low-end versions of the Galaxy A and J series while unveiling the new Galaxy C series exclusively for the China market.
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For processors, demand for 14-nanoameter mobile application processors increased as well as image sensors.
Samsung’s results are in contrast to rival Apple. When the Note 7 drops next month, there won’t be much for Samsung to say-we’ll already know basically everything about the device before the Korean company takes the stage at an event on August 2.
“With a new Galaxy Note 7 flagship model rumored to be on the way, Samsung will be able to strengthen its smartphone leadership in the second half of the year”, Strategy Analytics analyst Neil Mawston said in a statement.
Samsung Electronics Galaxy S7 and S7 Edge smartphones are displayed at the company’s showroom in Seoul, South Korea, Thursday, July 28, 2016. Early launches helped Samsung report strong sales during the first quarter but there were doubts that it could sustain the momentum during the second quarter.
Samsung is expecting things to get even better in the second half of 2016. mainly driven by earnings increases in the component business due to sales growth in high value-added products.
Mobile phone sales, including smartphones, totaled 90 million units in the second quarter, with tablet sales reaching 6 million.
It marked the first time in two years that Samsung’s smartphone profit topped 4 trillion won.
Though some investors say Samsung’s profit may have peaked in April-June, signs of recovery in memory chip and display panel prices suggest the components businesses could buttress earnings in the second half. Demand for chips and display panels are expected to be strong due to the launches of new smartphone models from Samsung and Apple.
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“Profit at its mobile unit may dwindle a bit in the third quarter, but Samsung will again bring out its next Note device earlier than a year ago to battle it out”.
