Samsung`s share of US smartphone market 2X that of Apple

Samsung smartphones’s market share in the U.S. is almost two times of that of Apple, and there seems to be no competitor. Thanks to brisk sales of smartphones, Samsung Electronics raised the largest ever quarter operating profit 6.72 trillion won (5.89 billion U.S. dollars) during the second quarter (April ~ June) this year.

According to the earnings announced by Samsung Electronics (Friday) and Apple (Tuesday), and a report by U.S. market research agency Strategy Analytics, Samsung sold 50.5 million units of smartphones worldwide in the second quarter this year while Apple was selling 26 million units, further widening the gap. In the market share, Samsung claimed about two time of Apple at 34.6 percent to 17.8 percent. The gap was only about 7 percentage point in the first quarter this year.

Smartphone sales in the second quarter reached 24.04 trillion won (21.09 billion U.S. dollars), up 60% year on year, with operating profit 4.19 trillion won (3.68 billion U.S. dollars), up 145% from the same period last year, pushing up the average earning of the entire company. On the contrary, Apple announced Tuesday that its sales and net profit increased about 20% each. This lower than expected results disappointed the market, and some said that iPhone is now experiencing slump.

The market experts say that Samsung smartphone will likely to continue to sell the most through this year until iPhone 5 will be launched. Samsung Electronics announced that it will “focus on selling more Galaxy S3 during the third quarter this year and maintain its market share by producing various smartphone models targeting newly emerging markets.”

Apple plans to turn the situation to its advantage this fall by releasing a new iPhone model. Apple CEO Tim Cook said that Apple’s next phone would create the “fall transition."

Oh the other hand, Samsung’s Friday announcement was close to an “earning surprise.”

Aside smartphones, the operating profit of home appliances recorded 760 billion won (667 million U.S. dollars), up 66% year on year. Display panels business, which recorded deficit in the same period last year, such as LCD and OLED, recorded operating profit 750 billion won (658 million U.S. dollars). The operating profit of the semiconductor sector shrank by 38% from the same period last year to 1.10 trillion won (960 million U.S. dollars) due to decline in product prices. Samsung’s share price closed at 1.233 million won (1,081.58 U.S. dollars) Friday, up 5.4 percent from Thursday.

Samsung said, “Exchange rate fluctuations including weaker Euro during the second quarter cost operating profit about 79 billion won (69 million U.S. dollars), but we earned the largest ever operating profit thanks to our strong competitiveness in technology.” “We will strengthen the competitiveness of our main businesses by investing 11 trillion won (9.65 billion U.S. dollars) in facilities and further differentiate our products.”

jaj@donga.com