NEW YORK—Samsung Electronics Co. Ltd. increased its shipment volume in the third quarter to 30.7 million, a 17-percent increase from the previous, disappointing quarter, according to CIBC World Markets. The South Korean vendor’s shipments beat its own guidance and CIBC’s earlier estimates of 28.8 million and may have garnered the vendor a full point in market share for 12.5 percent of the market.
Samsung is expected to release its quarterly earnings report today.
CIBC analyst Ittai Kidron attributed Samsung’s improved volume shipments to new models in the company’s Ultra series that were launched in the second quarter and sold well in the United States and Europe in third quarter. CIBC is projecting a modest sequential increase for fourth quarter to 31.3 million.
Samsung’s DRAM memory chip business, which drives the company’s overall profits, is also expected to show significant growth in third quarter, according to a Reuters report.
Though Samsung is expected to release more new phone models in the fourth quarter, Kidron wrote in an investor’s note, Samsung and its largely mid- and high-end handset portfolio over time is expected to lose market share relative to market leaders Nokia Corp. and Motorola Inc., which deliver enormous numbers of handsets to emerging markets.
In a separate note, Kidron cited news reports that Nokia is cutting prices on its new models of its handsets in European markets, possibly due to a holiday pricing strategy but also possibly because demand may be weak for its handsets—foreshadowing a tough quarter for the Finnish handset vendor, whose discounting could affect its average selling prices (ASPs) and those of its main Euro-rivals, Motorola and Sony Ericsson Mobile Communications L.P. The analyst wrote that Nokia faces issues relating to the integration of its purchase of Siemens’ infrastructure business and its ongoing litigation with Qualcomm Inc.
The beneficiaries of Samsung’s strength in shipment volumes include baseband chipmaker, Qualcomm Inc., and RF chipmakers Skyworks Solutions and Anadigics.
Between Samsung’s shipment numbers and results last week from Sony Ericsson, the third quarter looks strong in the mid- to high-end handset tier, Kidron wrote. Nokia, Motorola and LG Electronics Co. are expected to announce financial results for the third quarter this week.
