Samsung’s Record Breaking Q4 As HTC Crumbles

With the millions of Android devices activated in 2011, you shouldn’t have to guess whether or not Android ODM partners did well in sales last year.  So let’s take a look at how the fourth quarter of the top two Android device makers turned out.


The South Korean company released their 2011  fourth-quarter earnings guidance today.  According to the report, Samsung’s consolidated sales were approximately 47 trillion Korean won or somewhere between 46 trillion and 48 trillion Korean won ($39.6 billion to $41.3 billion) and consolidated operating profit is estimated at 5.2 trillion Won or somewhere between 5.0 – 5.4 trillion Korean won.

Also, their estimated revenues for the fiscal year of 2011 were 164.70 trillion Korean won on consolidated basis, while operating profit was expected to be 16.15 trillion Korean won.

Breaking records

The figures stated by Samsung were record breaking as this is a new high point for the company.  Samsung’s 2011 revenue beats their 2010 earnings as it only generated 41.9 trillion won in revenue and a 3 trillion won profit.

Samsung did not elaborate as to why their fourth quarter did extremely well, but having the Australian ban lifted could be taken into account, as well as the fact that the fourth quarter encompasses the holiday shopping madness where this year, everyone wanted a gadget as a present.

“Samsung’s ascendancy to the leadership position is the direct result of its broad and deep product portfolio,” Ramon Llamas, senior research analyst with IDC’s Mobile Phone Technology and Trends team, said in a statement in November. “Ever since the first Galaxy device launched last year, the company has aggressively expanded and refreshed its selection to include the latest innovations and most popular features.”

Though they had an awesome fourth quarter, they still suffered a little bump in the road as the case they filed for a preliminary injunction against Apple’s iPhone 4S in Italy was declined.

“We are disappointed with today’s decision by the Milan court regarding Samsung’s preliminary injunction motion,” Samsung said in a statement to CNET. “We will review the ruling and consider all available measures to further protect our intellectual property rights and stop this free riding on our technology.”


On the other hand, the second largest smartphone maker didn’t seem to have an awesome fourth quarter.  The Taiwanese electronics company HTC released their fourth quarter earnings stating that their net profit fell 26% to NT$11 billion ($364 million) from NT$14.8 billion a year earlier as a result of intensifying competition and a slowing global economy. It is predicted that HTC’s sales and shipments will decline further as the company cut its outlook for revenue in the last three months of 2011.

“Severe competition at the high end from Apple and Samsung forced their sales lower during the quarter,” said Peter Liao, a Taipei-based analyst at Nomura Holdings Plc. which has a “neutral” rating (2498) on the stock. “The key is when they can find their competitive edge, which may not happen until the second quarter at the earliest.”

The decline of HTC’s revenue can be due to the fact that they have only released smartphones, where as competitors like Apple and Samsung have smartphones and tablets. This puts HTC at a great disadvantage, as they are in direct competition with other device manufacturers who are also focusing on smartphones but the difference is that they offer both high-end and low-end devices like Nokia.

“There’s a balance to be struck between giving consumers a good set of options and just confusing them with too much choice,” noted Benedict Evans, an analyst with Enders Analysis in London, to me. “Nokia made that mistake a few years ago and HTC has made it now. Even the naming is confusing – which is the better product out of the Sensation, Wildfire, Desire or Incredible?”