Samsung Electronics’ smartphone business saw its operating profit increase to the 2 trillion won (US$1.71 billion) range thanks to the popularity of the Galaxy S10 series.
Samsung Electronics officially announced on April 30 that its IT & Mobile Communications Division, which is in charge of the smartphone business, posted 27.20 trillion won (US$23.31 billion) in sales and 2.27 trillion won (US$1.95 billion) in operating profit in the first quarter of this year.
The company’s operating profit grew 50 percent from 1.50 trillion won (US$1.29 billion) in the previous quarter when it failed to reach 2 trillion won (US$1.71 billion) in operating profit for the first time in nine quarters since the Galaxy Note 7 fiasco. However, the operating profit still fell nearly 40 percent compared to the first quarter of last year when it recorded 3.80 trillion won (US$3.26 billion). A spokesperson of Samsung Electronics said, “The company’s sales greatly increased from the previous quarter despite the off-season, propelled by robust sales of the Galaxy S10 series. Yet profit improvement was limited due to the cost increases stemming from higher specifications of new products, brand marketing activities and low-end lineup changes.”
The Galaxy S10 series has been recording approximately 120 to 130 percent of sales compared to that of its predecessor, the Galaxy S9 series, after it came onto the market on March 8. The company sold a total of 78 million units of cellphones in the first quarter this year and smartphone accounted for 90 percent of the total.
Samsung Electronics is planning to keep the sales momentum for the Galaxy S10 series and at the same time strengthen the competitiveness of its low and middle priced products, including the Galaxy A series, in the second quarter.
In particular, all eyes are on whether Samsung Electronics can launch its first foldable phone, the Galaxy Fold, in the second quarter. The company has delayed the launch of the Galaxy Fold after several reviewers reported problems with the smartphone’s display.