Galaxy lifts Samsung to the top

Samsung Electronics raked in a record $5.2 billion (3.93 billion euros) in profits after selling 93.5 million mobile phones in the first three months of 2012, the South Korean firm announced Friday.

According to figures released by Strategy Analytics, more than one in every four mobile phone sold around the world was now made by Samsung, meaning the technology firm had replaced Finish handset maker Nokia as global mobile phone leader.

Strong demand for Samsung's high-end Galaxy smartphones caused its sales in this segment to surge to 44.5 million handsets in the first quarter, outnumbering even Apple's sales of 35.1 million iPhones, Strategy Analytics' data showed.

Samsung's mobile communications division contributed a $3.7 billion operating profit to the quarter result, masking lower profit from the firm's semiconductor business where sales more than halved to $669 million.

"We cautiously expect our earnings momentum to continue going forward as competitiveness in our major businesses is enhanced," Robert Yi, head of Samsung investor relations, said in a conference call Friday.

Smartphone duopoly

Samsung's mobile business president Shin Jong-kyun said the company was aiming to sell 380 million handsets this year, including 200 million smartphones - up from last year's sales of 330 million and 97 million respectively.

After outselling Nokia by 10 million handsets in the first quarter of 2012, Samsung is locked in fierce competition with US iPhone maker Apple in the lucrative smartphone market.

"Samsung and Apple are out-competing most major rivals and the smartphone market is at risk of become a two-horse race," Neil Mawston, an analyst with Strategy Analytics, told Reuters news agency.

Samsung hopes to increase its 30.6 percent share of the high-end market over Apple's 24.1 percent with the launch of a new generation of its flagship Galaxy S smartphone this summer.

"The Galaxy S 3's specifications are expected to be sensational and it's already drawing strong interest from the market and consumers, Brian Park, an analyst at Tong Yang Securities told Reuters.

China - the world's biggest and fastest growing mobile phone market - has become the main battlefield of the two rivals with Samsung currently owning more than 30 percent of the Chinese market, but with Apple recently being able to boost its iPhone 4S sales five-fold there.

uhe/sgb (Reuters, AP, dpa)