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Samsung has confirmed its first profit growth in more than a year, announcing record revenue from computer chips as its smartphone business slows.
The Korean technology giant said it made 6.4 billion US dollars (£4.1 billion) in operating profit in this quarter, a rise of more than 2 billion dollars (£1.3 billion) on this time last year, with net profit and sales also up compared to 2014. Samsung said this was being driven by its computer chip and display panel parts of the business.
But the firm’s mobile business slowed with it reporting 2.1 billion US dollars (£1.3 billion) in operating profit, which although an increase on the same quarter last year, was a drop from 2.4 billion US dollars (£1.5 billion) in the previous quarter.
Samsung’s mobile arm has come under pressure from Apple in the last year thanks to the introduction of the larger iPhone 6 Plus – a “phablet” similar in size to several lines of Samsung device. More competition at the lower price points from smaller manufacturers in China and beyond has also squeezed Samsung’s position.
But Samsung said they had seen a “significant” increase in sales of two of their flagship smartphones, the Galaxy Note 5 and the Galaxy S6 edge+, but a price cut to their iPhone competitor S6 and S6+ models contributed to a profit decline in the mobile business. This was despite the company shipping more phones and seeing an increase in revenue, which Samsung attributed to selling more cheaper models.
The technology giant added that they expected to sell more smartphones over the Christmas period, but the firm warned that this is not likely to push profit up because it expects foreign exchange rates to be less favourable.
These results come a day after Apple announced profits of £7.2 billion, having sold more than 48 million iPhones in the last three months.
