Samsung sees record profits in the last quarter of 2011, thanks to smartphones

by Phil Hornshaw

It was another big quarter for Samsung to end 2011, with its Android-running smartphone business pushing the South Korean electronics maker to record profits.

According to a story from Reuters, Samsung reported its record-breaking quarter today and also notched its best quarter ever for high-end smartphone sales. The company took down 5.2 trillion won ($4.5 billion) in quarterly operating profit, beating the Q2 2010 record of 5.0 trillion won. Its profits were up 22 percent from Q3 2011, as well, Samsung said.

Samsung has seen some one-time gains, like from the sale of its hard drive business, and has had some of its other primary departments squeezed, like its chip manufacturing division. But it’s Samsung’s smartphone offerings that continue to produce. Reuters reports Samsung’s smartphone shipments are expected to hit a record 35 million in Q4 2011, which is up from Q3. That’s the quarter in which Samsung overtook Apple to become the single worldwide leader in smartphone sales by revenue.

It was back in October that Samsung announced it had made $13.5 billion with its telecom division, a 37 percent increase over the same period in 2010. Much of that success was the result of the popularity of the Galaxy S smartphone line, and some analysts are projecting another great year for Samsung in 2012, with as many as 170 million smartphones sold. That’d be a pretty huge increase from the estimated 95 million smartphones analysts believe Samsung moved in 2011.

It’s a good thing smartphones are doing so well for Samsung, because slowing PC sales could hurt its primary chip-making business. But the company already has strong elements in place for 2012, like the Galaxy Note, a dual-core, 4G smartphone with a 5.3-inch display. With Google notching 700,000 Android device activations daily, Samsung seems to be in a position to continue to lead the pack in the mobile sphere, so long as it continues to do what it has been doing, offering strong, high-end phones along with more affordable ones. It worked in 2011 and it should work in 2012.

Record profits this year should be plenty to encourage Samsung to keep producing the devices Android users want far into the future.