Samsung Posts Record Profit for Second Straight Year, HTC Reports First Quarterly Loss

Egads, talk about a tale of two different tech firms moving in completely opposite directions. Let's start with Samsung, the South Korean handset maker that's becoming the face of Android in the smartphone space. For the second year in a row, Samsung posted record earnings with an operating profit of 38.5 trillion won, or about $35.8 billion for the year, up around 33 percent from 2012.

What's interesting about Samsung's success is that its memory business is largely to credit for the record growth. According to Reuters, the global chip market has been on the up and up since late 2012 due to a number of factors, including supply constraints from slowed production in past years and increased factory capacity to serve the smartphone and tablet markets. Samsung also benefited from a fire last month at a China plant owned by Hynix, which drove additional customers to Samsung.

The booming memory market has helped Samsung weather slowed smartphone sales. The company now expects its operating profit for the third quarter to reach a record 10.1 trillion won ($9.39 billion).


Meanwhile, HTC just posted its first ever quarterly loss since going public in 2002, underscoring the changing of the guard in the Android space. HTC lost NT$2.97 billion ($101.23 million) on revenue of NT$47.05 billion ($1.6 billion). The cold reality for HTC is that it's ill equipped to compete with Samsung and Apple.

HTC lacks a solid strategy. The HTC One is proof that the company can still make a top tier Android handset, but it probably didn't help matters that it diverted resources to building its Windows Phone 8X, Windows Phone 8S, and HTC First smartphones, a trio of products that haven't done the company any favors.

Going forward, Microsoft is proposing to HTC that it load Windows Phone alongside Android on upcoming handsets. It could prove to be an intriguing opposition for Android users who are curious about Windows Phone but not yet ready to commit, but at the same time, it's another gamble for HTC, a company that can't afford to keep losing.

Tags:  Samsung, Mobile, HTC