Samsung soars to record Q1 on the back of smartphone sales

Samsung Electronics rode rising smartphone sales to a record first-quarter profit and also used its muscle to overtake Nokia (NYSE:NOK) as the world's largest handset maker by volume, stripping Nokia of its crown after 14 years at the top.

Click here for details from Samsung about its performance in the first quarter.

Samsung, which makes everything from TVs to chipsets, posted a $4.4 billion net profit in the quarter, up 81 percent from the year-ago period. The South Korean conglomerate's operating profit reached an all-time high of $5.16 billion, up 98 percent from the first quarter of 2011. Overall net sales clocked in at $40 billion for the quarter, up 22 percent from the year-ago period.
However, it was Samsung's performance in its mobile business that was exceedingly strong. Sales in the mobile division were $16.68 billion, up 86 percent year-over-year from $8.95 billion. Samsung nearly tripled the operating profit of its telecommunications business, which houses its handset and network technology units.
Starting in the middle of last year Samsung stopped reporting how many handset and smartphone units it shipped, making it difficult for observers to guess where it stands among its peers. Samsung only said that its smartphone sales were strong and that shipments increased across all regions, especially in the emerging markets. The company said it saw "steady" sales of its existing models Galaxy S II, Ace and Y and sales expansion of high-end strategic models such as the Android-powered Galaxy Note and Galaxy LTE. Samsung said its average selling price increased from the fourth quarter due to an improved product mix, which likely meant more smartphone sales.
Despite those vague pronouncements, according to research firm Strategy Analytics Samsung claimed the top handset vendor spot in the first quarter, claiming the lead in overall sales of feature phones and smartphones combined. According to the firm, Samsung shipped 93.5 million units in the quarter, up from 68.9 million in the year-ago period and surpassing Nokia's 82.7 million in the first quarter of 2012.
Strategy Analytics also estimated that Samsung passed Apple (NASDAQ:AAPL) in smartphone sales in the quarter. According to the research firm Samsung had 44.5 million smartphone shipments in the quarter, up from 12.6 million smartphone shipments in the year-ago quarter, and easily besting Apple's 35.1 million iPhone shipments and Nokia's 11.9 million smartphone shipments.
The rosy times for Samsung are likely to continue in the second quarter. The company recently said it will unveil its latest flagship smartphone, widely believed to be the Galaxy S III, at an event in London on May 3. The device, which likely will pack a 1.4 GHz quad-core Exynos processor, is expected to be another blockbuster device for the firm.
For more:- see this Samsung release- see this Samsung presentation (PDF)- see this Strategy Analytics release- see this separate Strategy Analytics release- see this WSJ article (sub. req.)- see this Reuters article- see this Bloomberg article
Special Report: Wireless in the first quarter of 2012
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