* Q1 operating profit 5.85 trln won vs 5.8 trln won guidance
* Mobile unit profit at 4.27 trln won, margin up to 18.4 pct
* Profit from chip division more than halved to 760 bln won
By Miyoung Kim
SEOUL, April 27 Samsung Electronics Co
, the world's top technology firm by revenue,
reported a record quarterly profit on Friday, as its Galaxy
smartphones and Note phone/tablet helped it win market share
from Nokia and as it outmuscled Japanese rivals in
TVs and memory chips.
Samsung did not break out its first-quarter smartphone and
handset shipments, but analysts forecast it ended Nokia's
14-year leadership of the global cellphone market, outselling
the struggling Finnish company for the first time.
Nokia sold 83 million handsets in January-March, including
12 million smartphones. Samsung is estimated to have sold 90
million handsets, including 44 million smartphones, according to
Samsung reported January-March operating profit of 5.85
trillion won ($5.15 billion), broadly in line with its earlier
estimate of 5.8 trillion won, and nearly double the 2.95
trillion won a year ago. In the fourth quarter of 2011, the
company had an operating profit of 5.3 trillion
Its handset division profit nearly tripled to 4.27 trillion
won, accounting for 73 percent of total profit. Operating profit
margin of the division also improved to 18.4 percent from 11
percent a year ago and 12 percent in the preceding quarter,
helped by strong sales of the high-end Galaxy S and Note.
Samsung and Apple have formed a near duopoly in the high-end
smartphone market, as traditional stalwarts struggle to
introduce compelling models that can successfully crack into the
The duo controlled 90 percent of the high-end smartphone
market last year and their combined stake will remain little
changed at 88 percent by 2013, according to Bernstein analysts.
Samsung - which has deals with all three of China's big
telecoms operators - already pushed out Nokia as China's top
smartphone vendor in the fourth quarter, with around 25 percent
market share, and analysts expect that to have increased as
Nokia slips further. "Samsung's smartphone success in the first
quarter was the flip-side of Nokia's disappointment," Matt
Evans, a CLSA analyst, said in a recent report.
China's smartphone growth has defied most forecasts, and
South Korean smartphone chip maker SK hynix this
week predicted smartphone sales in China could be 20-30 percent
higher than originally expected, given the level of orders it
"Overall Chinese demand was very strong in the first quarter
and will drive global smartphone shipments to over 700 million
this year," Kim Ji-bum, SK hynix head of global marketing and
sales, told analysts.
Samsung, which last year sold close to one in every five
smartphones worldwide, should build on that market leadership
with the launch in London next week of a third generation of its
flagship Galaxy S, backed by heavy marketing ahead of the summer
Olympics. The new Galaxy will use Samsung's quad-core
microprocessor, which it hopes to see in handsets sold by Nokia,
HTC and Motorola, as well as Apple, its biggest
Samsung also competes with Sony Corp and LG
Electronics in TVs, Toshiba and SK hynix
in chips and LG Display in displays.
Shares in Samsung, the world's top TV maker, have climbed 27
percent so far this year, and hit a record high of 1.351 million
won ($1,200) earlier this month. The broader KOSPI stock
index is up around 8 percent this year.