increased its operating profit
by more than 50 percent during the first quarter, taking in 8.78
trillion won ($7.9 billion) before the company's biggest
smartphones were even released. Riding high on the success of
older models (such as the Galaxy S III or the more recently
released Galaxy Note II), Samsung has begun to extend the sales
longevity of its devices.
The South Korean tech giant will release the Galaxy S IV --
the successor to its flagship phone -- sometime during the second
Despite the impressive earnings, Samsung was unable to top its
Cupertino, California-based competitor. While Apple's (NASDAQ:
) revenue of $43.6 billion was a few billion dollars lower than
Samsung's revenue of $47.6 billion, the iPhone maker
earned a net profit
of $9.5 billion, topping Samsung's net profit of $6.45
Take a closer look, however, and investors will see that
Samsung may be in the better position right now.
In addition to raising revenue, Samsung's net profit increased
slightly over the year-ago period, at which time the company
earned $6.3 billion on revenues of $40.7 billion.
Apple, on the other hand, has watched its profits fall from
$11.6 billion on revenues of $39.2 billion during the
fiscal 2012 second quarter
to just $9.5 billion on revenues of $43.6 billion during the
fiscal 2013 second quarter.
Samsung's expenses are
while Apple's are on the rise. The iPhone's margins are
, but the latest model is said to be one of the most expensive
and the most complex smartphones ever produced.
Apple did not improve its situation by rejecting as many as
imperfect iPhones produced by Foxconn. While this decision may
have saved the company billions of dollars in the long run, the
initial hit could be responsible for reducing Apple's revenue --
especially if the rejection was spread across no more than one or
Analysts have responded
to Apple's second quarter results, despite the
record-breaking iPhone sales
that surpassed expectations.
While analysts may be giving Apple a hard time, some fund
managers have come to the firm's defense, arguing that Apple is a
that should not be sold on the results of any particular
Louis Bedigian is the Senior Tech Analyst and Features Writer
of Benzinga. You can reach him at 248-636-1322 or
louis(at)benzingapro(dot)com. Follow him
(c) 2013 Benzinga.com. Benzinga does not provide investment
advice. All rights reserved.
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