Samsung sees profit rise 42 per cent

Korean manufacturer Samsung Electronics has seen its quarterly net profit rise 42 per cent year on year, for the first three months of 2013. The firm made KRW7.15tn ($6.4bn) in 1Q13, up from KRW5.15tn in the same period last year. Revenue for the quarter was also up KRW7.6tn year on year, reaching KRW52.87tn.

The news comes just days after rival Apple posted its first quarterly drop in profit in ten years, with the $9.5bn 2Q13 net profit marking a more than 18 per cent decline year on year. The firm sold 37.4 million iPhones in the quarter, while iPads sales reached 19.5 million.

Samsung’s IT and Mobile Communications (IM) division benefitted from strong smartphone sales coupled with reduced marketing expenses, the firm said.  The division generated revenues of KRW32.82tn in the quarter, marking a seven per cent increase on the previous quarter.

Samsung said it saw sound sales of its Galaxy S III and Galaxy Note II devices, but cautioned that in the second quarter of 2013, global demand for smartphones is forecast to dampen due to heightened competition.

“Although market uncertainties from the European crisis and the slow global economic recovery are still lingering, we expect to increase R&D spending for strengthening our competitiveness ahead of planned new product launches,” said Robert Yi, senior VP and head of investor relations.

“We may experience stiffer competition in the mobile business due to expansion of the mid- to low-end smartphone market while TV growth will continue to wane in developed markets.”

Samsung added that smartphone sales are expected to stay flat in the second quarter but will pick up again in the second half of the year.

The firm added that its Networks Business benefitted from a stable demand for LTE telecommunications equipment.

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