By Miyoung Kim
SEOUL | Fri Jan 27, 2012 4:45am EST
SEOUL (Reuters) – Samsung Electronics Co posted a record $4.7 billion quarterly operating profit, driven by booming smartphone sales, and will spend $22 billion this year to boost production of chips and flat screens to pull further ahead of smaller rivals.
The South Korean firm, the world’s top technology firm by revenue, is locked in breakneck competition with Apple Inc in the red-hot smartphone market. Apple, overtaken by Samsung in the third quarter, regained its crown as the world’s biggest maker of smartphones in the fourth quarter, with record sales of 37.04 million iPhones.
Samsung didn’t give its own sales volume data, but research firm Strategy Analytics put sales at 36.5 million smartphones in October-December, with 3rd-ranked Nokia on 19.6 million. Smartphones account for around 40 percent of all Samsung’s handset shipments.
Samsung’s telecoms business earned a record 2.64 trillion won ($2.35 billion) profit in October-December on increased sales of its flagship Galaxy smartphones.
“The battle of the two big smartphone powers, Apple versus Samsung, will go on,” said Baik Jae-yer, fund manager at Korea Investment Management, which has around 9 percent of its portfolio in Samsung stock, according to end-September filings.
“The smartphone market will expand this year to more mid-and low-end models that are affordable to the wider public,” Baik said. “Rather than focus on market share, I’d point out the strong contribution of Samsung’s handset business to earnings growth and margins.”
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http://www.reuters.com/article/2012/01/27/us-samsung-idUSTRE80P1KY20120127
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