Samsung reported a drop in mobile revenues and profit in the first quarter but said shipments improved compared to the previous quarter thanks to new mid-range models like the 2017 A series. Revenues at the mobile division fell 15 percent year-on-year and 0.5 percent from the fourth quarter to KRW 23.50 trillion, and operating profit was down to KRW 2.07 trillion from KRW 3.89 trillion a year ago.
Samsung said profit was under pressure due to fewer shipments of its flagship model, the S7. The release of its successor in April should help Q2 revenues and operating profit improve on a quarterly basis, but Samsung forecast flat shipments compared to Q1, due to slower shipments in the mid- to low-end range.
For the rest of 2017, Samsung said it expects solid replacement demand for mid- to high-end smartphones, but competition will intensify in the second half, when Apple is expected to release a new iPhone. The company plans a new Note model in H2 to help shore up sales as well focusing on profitability of its mid-range of smartphones in order to drive earnings growth.
The company's net profit in the first quarter totalled KRW 7.68 trillion, up from KRW 5.25 trillion a year ago. Operating profit rose to KRW 9.90 trillion, in line with the company's forecast and driven by expansion in the semiconductor business, and revenues were up slightly to KRW 50.55 trillion from KRW 49.78 trillion. Samsung said it expects the chip market to remain positive in the rest of the year, driven by demand for its server and mobile products.
