Samsung to dial up £3.6bn first-quarter profit

ELECTRONICS giant Samsung is now expecting its first-quarter operating profit to top some £3.6 billion, ahead of analysts’ hopes.

While the company did not give reasons as it released its preliminary numbers, experts said robust demand for its mobile chips and an improvement in its smartphone business were behind the better-than-expected result.

Samsung’s earnings preview put its January-March operating profit at about 5.9 trillion won (£3.6bn), which was higher than analysts’ consensus of 5.5tn won, according to financial data provider FactSet. That was a 31 per cent drop from a year earlier.

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The South Korean giant’s operating profit was an improvement from the previous two quarters when its mobile business, which accounts for two-thirds of income, suffered from a sales slowdown.

Analysts believe the company’s profits hit a bottom during the third quarter as its smartphone sales slowed, with criticism mounting about the cheap-looking, plastic design of the Galaxy S5 smartphone.

They expect a continued recovery in Samsung’s bottom line in the current quarter as the firm is set to launch the latest version of its flagship smartphone, the Galaxy S6, in several major markets on Friday.