30X Higher than A Year Ago
Samsung Electronics announced on October 31 that its IT & Mobile Communications (IM) division posted 27.69 trillion won (US$24.73 billion) in sales and 3.29 trillion won (US$2.94 billion) in operating profit in the third quarter.
The figures were 30 times higher than some 100 billion won (US$89.33 million) of operating profit in the third quarter last year when the company was forced to recall the Galaxy Note 7 after a battery flaw caused dozens of the phones to explode or burst into flames. However, the numbers fell short of 30.01 trillion won (US$26.81 billion) of sales and 4.06 trillion won (US$3.63 billion) of operating profit in the previous quarter.
Samsung Electronics said, “The total smartphone sales increased because of the Galaxy Note 8 and Galaxy J series, but revenue and earnings in the segment declined compared to the previous quarter because more customers sought out mass-market smartphones instead of its pricier devices.”
Industry watchers initially expected that the IM division would struggle as the Galaxy S8 sales would decrease and marketing costs for the latest Galaxy Note 8 phone would increase in the third quarter. However, the division has put up a good show since there is a steady sale of low-end phones, including the Galaxy J series, and the Galaxy Note 8 has had a favorable market response.
As the Galaxy Note 8 will boost sales in earnest in the fourth quarter and Apple’s new iPhone X will be released in the global market on November 3, the competition is expected to be strong.
The Galaxy Note 8 released in the global market on September 15 has posted the biggest ever pre-sales among the Note series, gaining popularity. Its domestic pre-sales stood at 850,000 units, over twice as many as 400,000 units of the Galaxy Note 7.