Samsung profits soar again, but can it last?

South Korea’s Samsung has posted a fourth straight record quarterly profit – the equivalent of 5.74 billion euros. Strong demand for its Galaxy smartphones – with 56.3 million sold – masked sharply lower sales of memory chips. However analysts warned that cannot continue with the recent breakneck speed in smartphone sales growth due to ease next year. “The biggest concern for Samsung is that its smartphone growth momentum will slow. It’ll be difficult to maintain such a high profit margin from handsets as the market gets crowded and competition will intensify,” said Nam Dae-jong, an analyst at Hana Daetoo Securities. While Samsung outsells Apple in gadgets, the Korean group’s market value is just a third of the U.S. firm’s, and investors question whether it can narrow that gap as the stellar handset business is set to lose steam and Apple, also its biggest customer, looks to spread its supplier base wider. “Samsung has a lot of strong businesses like tablets, OLED TVs and micro-processor chips that could become its next big thing and step it up to the next level,” said Lee Sun-tae, analyst at NH Investment & Securities. “But these aren’t fully ready to become a real earnings driver like the Galaxy.”