The records keep tumbling for Samsung Electronics. If earnings are in line with Wednesday’s estimates, the April-June period will be its second best-ever quarter in a row. This year Samsung Electronics deposed Hewlett-Packard as the world’s largest technology company by sales. In terms of net profit, it is on course to make more this fiscal year than the top 19 Japanese technology and consumer electronics firms put together.

All this obscures the fact that the flagship company of South Korea’s largest chaebol is increasingly a tale of two units: one very good (semiconductors), the other fair to middling (panels, phones and digital media). The first is a largely commoditised market in which Intel, Samsung and TSMC are emerging as industry titans, selling vast numbers of components to plug into other people’s gadgets.

The semiconductor division should account for just over half of operating profits this year, from less than a quarter of sales. But the other unit is showing signs of suffering from years of prioritising speed over innovation; reacting, rather than acting. This is more than mere cyclicality. Five years ago, for every dollar it spent on selling and marketing, Samsung spent 58 cents on research and development. Last year that ratio fell to 1:0.48. At brand-fixated Apple, relative R&D spending rose by 2 cents during the same period, to 24.

Perhaps as a consequence, Samsung is failing to set consumers’ pulses racing. Lacklustre sales of TVs and appliances meant that digital media probably posted falling operating margins in the second quarter. The handset division, too, has been officially “rebuilding”, a euphemism for struggling. Samsung’s new tablet computer, the Galaxy Tab, bears an uncanny resemblance to the iPad; the one difference of note is a 7in screen, to Apple’s 10in. Those me-too qualities are reflected in one metric that really matters: Apple’s $226bn market capitalisation is almost 2.5 times Samsung’s.

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