By Kim Yoo-chul
Samsung Electronics said Friday its first-quarter operating profit jumped to a record high of 8.78 trillion won on the back of brisk sales of its flagship Galaxy S3 handsets.
The world’s biggest technology firm by revenue posted operating profit of 8.78 trillion won ($7.9 billion) between January and March, up 54.3 percent from a year earlier. Its net profit also soared to 7.15 trillion won, compared with the previous year’s 5.05 trillion won.
In revenue, the firm posted 52.87 trillion won during the period, beating its rivals Apple, Microsoft and Google, which recorded $43.6 billion $20.5 billion and $14 billion, respectively.
The company said robust sales of Samsung Galaxy S3 smartphones and its Galaxy Note phablets drove the strong performance.
Its IT and mobile communications division posted a record operating profit of 6.51 trillion won, accounting for some 70 percent of the total profit Samsung reported during the quarter.
Samsung’s component division reported 15.81 trillion won as its first quarter revenue with 1.85 trillion won as operating profit.
Kim Hyun-joon, an executive in the mobile communications division, told analysts and investors Samsung expects fiercer competition in smartphones in the latter half.
``We can’t comment on our plan whether to release phones with flexible displays this year. The Galaxy S4 will beat the Galaxy S3 in sales,’’ Kim said.
Analysts expect Samsung to report stronger profits during the April-June quarter as the Galaxy S4, the latest iteration of the Galaxy S smartphone, goes on sale worldwide, months before Apple introduces its new version of the iPhone.
The Galaxy S4 was introduced in South Korea Friday before its release in the United States Saturday.
Samsung said initial orders for the Galaxy S4 were higher than expected, making it difficult to meet demand.
Its consumer electronics division, which manages televisions and other home appliances, reported revenue of 11.24 trillion won with 230 billion won in operating profit, hit by weak demand.
Samsung told market analysts and investors it will grow its profit continuously and stressed the company expects recovery in components such as memory chips and flat-screens from the current quarter.
Samsung invested 3.9 trillion won for the quarter on facilities with its chip business and display business investing 1.5 trillion won.
``Samsung will invest more in the latter half. Rather than building new chip-making lines, we will be quicker to migrate into thinner technologies, especially in mobile DRAMs,’’ said Baek Ji-ho, an executive at its semiconductor division during a conference call.
Baek said it will start the operation of its NAND flash chip plant in Xi’an, China, early next year. Samsung plans to manufacture three-dimensional (3D) flash chips at the Chinese plant with samples shipping to customers this year.
Baek also stressed the company doesn’t see any big problems on production yields of its octa-core application processors.
``We don’t see problems in specifications and features of our octa-core chips. We will continue selling those chips,’’ he said. Amid the rising demand for data-intensive digital devices, Samsung was the industry’s first to produce phones using ``eight brains.’’