Samsung net income jumps 81% to €3.36bn

SAMSUNG ELECTRONICS, the world’s biggest maker of mobile phones, computer-memory chips and TVs, posted its highest profit in at least two years after beating Apple and Nokia in smartphone sales.

Net income jumped 81 per cent from a year earlier to 5.05 trillion won (€3.36 billion), the South Korea-based company said, beating the 4.24 trillion-won average of 29 analyst estimates compiled by Bloomberg.

Samsung shares rose to a record in Seoul as earnings at the mobile-phone business almost tripled in the quarter, with new models such as the Galaxy Note taking on Apple’s iPhone and iPad.

Samsung, which overtook Nokia Oyj as the world’s biggest handset maker in the first quarter, said momentum in the €165 billion smartphone market will continue, with “remarkable” demand in emerging markets helping to mask a drop in chip profits. “The biggest driver now is smartphones,” said Park Jong-min, a portfolio manager at ING Investment Management. “It will stay good in the second quarter as new models are released.”

Samsung shares rose 2.5 per cent to 1,374,000 won in Seoul, extending gains this year to 30 per cent. Apple has surged 50 per cent in New York compared with a 28 per cent slump for Nokia in Helsinki trading.

Samsung’s profit is the highest since the first quarter of 2010. Operating profit at Samsung’s mobile business in the quarter was 4.27 trillion won, beating the 4.01 trillion-won median estimate in a Bloomberg News survey of four analysts. Samsung overtook Nokia as the world’s biggest handset seller for the first time in the three months ended March 31st, market researcher Strategy Analytics said yesterday.

Samsung shipped 93.5 million phones in the first quarter compared to Nokia’s 82.7 million. Samsung also regained the lead from Apple as the world’s biggest vendor of smartphones in the first quarter, Strategy Analytics said.

Samsung plans to double sales of smartphones and tablet computers this year, helped by new products, the company said in February. Including basic phones, Samsung expects to sell about 380 million handsets this year after shipping a record 300 million units last year. – (Bloomberg)