Samsung Electronics Co., the world's top maker of computer memory chips and smartphones, said Friday its first-quarter profit spiked 42 percent from a year earlier, buoyed by robust shipments of its flagship Galaxy S3 handsets.
Net profit came to 7.15 trillion won ($6.44 billion) in the January-March period, compared with 5.05 trillion won a year earlier, the company said in a regulatory filing.
Revenue soared 16.8 percent on-year to 52.87 trillion won in the first quarter and operating profit climbed 54.3 percent to 8.78 trillion won. The figures were roughly in line with Samsung's guidance released earlier this month.
The stronger bottom line was largely attributed to strong sales of the company's flagship mobile devices such as the Galaxy S3 and Galaxy Note 2 smartphones.
Shares of Samsung Electronics were trading at 1,489,000 won on the Seoul bourse as of 10:20 a.m., down 0.3 percent from Thursday's close.
Samsung's sound business results came from the brisk sales of the Galaxy S3 and the Galaxy Note 2 devices that were launched last year. Despite rival Apple Inc.'s iPhone 5 release, the company dwarfed the U.S. firm in fourth-quarter shipments.
Profit at its mobile division jumped 56 percent to a record
6.51 trillion won in the first quarter, accounting for almost three quarters of the firm's total profit, according to Samsung Electronics.
"Despite seasonally slow demand and allowances linked to its patent fight with Apple, Samsung performed well," said Woori Investment & Securities analyst Park Young-joo.
Park also added that when allowance for the legal tussle is not included, the company's quarterly profit might have been higher than the released figures.
Samsung Electronics, which is embroiled in a legal feud over smartphone patents with Apple, was ordered to pay roughly $600 million in compensation to the U.S. smartphone maker.
Samsung Electronics is estimated to have sold 70 million smartphones in the January-March period, according to Hong Kong-based market researcher Counterpoint Research.
The South Korean smartphone maker continued to dominate the global smartphone market in terms of market share, with its stake in the first two months of the year standing at 35 percent, compared with 32 percent in the fourth quarter of 2012, according to the researcher.
Market watchers pinned strong hopes on the company's second-quarter earnings, which will reflect profit from its latest flagship device Galaxy S4. Samsung Electronics started selling the fourth series of its Galaxy smartphone line-up in South Korea today.
"The Galaxy S4 is set to fuel Samsung Electronics' operating profit to roughly 10 trillion won in the second quarter," said LIG Investment & Securities Co. analyst Choi Do-yeon.
Samsung said Thursday that it expects demand for its Galaxy S4 smartphone to be stronger than expected. The Galaxy S4, one of the most highly anticipated smartphones of the year, is the latest in Samsung's successful Galaxy S line-up that has sold more than 100 million units worldwide.
Samsung Electronics said it plans to roll out the Galaxy S4 in the second quarter via 327 operators in 155 countries, including key mobile operators such as AT&T, Vodafone and Telefonica, from Saturday.
The company's chip, display panel and consumer electronics divisions also saw an improvement in their quarterly results.
Despite an industry-wide slump, Samsung's semiconductor business logged an operating profit of 1.07 trillion won in the first quarter, compared with 700 billion won a year earlier, on the back of high-margin products.
The display panel unit saw its operating profit nearly double to 1.85 trillion won over the cited period, driven by solid demand for TV and tablet panels.
The consumer electronics division, however, suffered a 230 billion won decline in operating income in the first quarter, compared with 500 billion won a year ago.
Samsung Electronics said it spent a total of 3.9 trillion won in the first quarter for facility expansion and upgrades. The company plans to spend 23 trillion won for the whole year. (Yonhap News)
