Samsung also revealed that it is expecting financial performance to continue to be strong throughout the rest of the year, fuelled mainly by the release of the Galaxy Note 7.
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Unlike in the first half where the S7 series had no level challenger, Apple is expected to launch its next iPhone in September, clashing directly will the upcoming Galaxy Note 4, which may divide consumers.
The world’s largest smartphone vendor posted $5.2 billion in net profit during the latest quarter, up 1.7 percent year over year, as revenue increased 5 percent to $45.2 billion. While Samsung focuses on strong S7 sales, its Q2 profitability was in part due to the cost-cutting measures the company has undertaken in response to an increasingly competitive environment. 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 beat forecasts even as growth in the overall smartphone industry slowed.
Samsung didn’t reveal how many smartphones it flogged in total during the three-month period, but analyst firm Strategy Analytics puts the figure at 78 million. The company launched the latest versions of its flagship smartphones in March, several weeks sooner than it did past year.
Apple’s recent earnings call revealed a 15 percent decline in the sales of iPhones since a year ago.
Lower prices for displays and semiconductors also helped the company’s sales to continue to grow while facing challenging economic conditions. That could change in the second half as the company faces new models from Apple.
Samsung was the first to mass produce chips using the technology and is producing the high-margin chips – used in mobile gadgets and hard drives for servers – at its factories at home and in China. As it failed to gain the demand after the release for the issues and troubles raised into the mass producing of the curved displays in the year 2015.
The Galaxy S7 Edge accounted for more than half of the sales leading to the profits in the second Quarter.
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“Outside of Samsung’s Galaxy S7 flagship, a majority of vendors, including Apple, have found success with more affordable models compared to their flagship handsets”, said Anthony Scarsella, research manager at the analysis firm IDC. Sales of OLED, or organic light-emitting diode, display panels rose, helped by healthy sales of flagship smartphones and higher demand for flexible displays for the S7 Edge.
