Samsung announced record earnings that were largely aided by sales of its Galaxy smartphones, while the same day HTC announced a third consecutive quarter of losses.
HTC, like Nokia and BlackBerry maker Research
In Motion, has learned how slippery the smartphone market's downhill is and how
tough it is to climb back up after a fall. Meanwhile, Samsung continues to
enjoy the view from the top.
Taiwan-based HTC announced its third
consecutive quarter of losses July 6. Its second-quarter net income was down 58
percent from a year earlier, to $247 million, by Bloomberg's
Apple's patent disputes with the company played
a part in its damaged income; smartphones were stuck for a time in U.S.
Customs, as the phone makers battled in court. More at fault, however, was
HTC's inability to compete against the Apple iPhone and Samsung's Galaxy line
of smartphones in the United States.
HTC was an early Android supporter and
enjoyed a strong response, in 2010, to its Evo 4Gat the time, the phone's
launch was Sprint's
most successful ever
. When HTC launched the Droid Incredible, analysts
conceded that HTC had gone from
the edge to the cutting edge
though added that it would be interesting to
see how the next year played out.
The year, alas, sent HTC back to the edge of
the market, as Samsung's Galaxy lineup gained momentum.
In April, HTC CEO Peter Chou told investors
that, due to the steep competition the company faced in the United States, it
planned to shift
to the European and Asian markets.
"New models which are tailored for China
have helped it continue boosting sales in the world's largest mobile phone
market," Bloomberg reported July 6, citing the firm SINO-MR. The firm
added that in China HTC could face "severe price competition," as its
low-end models lack some of the functionality of its competitors' low-end
Samsung, meanwhile, on July 6 released sales
estimates for its second quarter that set a new record for profits. Second-quarter
profits were up nearly 80 percent from a year earlier. Analysts, the Associated
reported, say the "sharp rise" came, thanks to Samsung's
In late June, JK Shin, head of Samsung's
mobile division, pointed to as much, saying that sales of the Galaxy S III were
expected to reach 10 million units in July.
"We're getting far better reviews on the
S III than we did with its predecessors globally... and supply simply can't
meet soaring demand, Shin
, adding that second-quarter results were likely to exceed
Samsung's also-excellent first quarter.
The U.S. launch of the Galaxy S III followed
debuts in 28 countries, and supplies have been slow to arrive. Sprint pushed
back its launch by 10 days, T-Mobile launched with only 16GB models in stock,
and AT&T, Verizon Wireless and U.S. Cellular were coy about their launch
dates, only announcing them once it was clear they'd have supplies in hand to
Because of the delays, analysts
dialed down second-quarter earnings
for Samsung and boosted third-quarter
The Galaxy S III is an
unusual phone in many respects
a standout in a market at pains to
differentiate Android-running devices. Still, Samsung's earning growth,
according to Bloomberg
, was driven not
only by sales of its own phones butthanks to its chip and display
businessesby the devices of its competitors as well.
Follow Michelle Maisto on