Samsung Electronics Co., on Friday said that its preliminary second quarter operating profit rose nearly 80 percent. The record high that the company registered is powered by Galaxy smartphone sales, according to AP.
The company said that its operating profit for April to June is estimated between 6.5 trillion won and 6.9 trillion won ($5.7 billion and $6.1 billion), a 79 percent jump from a year ago. Its revenue is expected to come in between 46 trillion won and 48 trillion won, up around 19 percent from the year earlier period.
Samsung's earnings growth is likely to continue into the third quarter due to strong demand for its new flagship Galaxy S III smartphone and mobile devices developed by the company's rivals, which help drive sales of Samsung's chips and displays.
According to Reuters, the flagship Galaxy smartphones are expected to increase its lead over rivals Apple and Nokia, despite a parts shortage that meant it struggled to keep up with stronger than expected demand for its latest S III model.
While strong handset sales grab the headlines, more than doubling profit growth, other businesses such as chips and consumer electronics are battling weak prices and demand and a limping euro, which eats away at repatriated profits.
Samsung's smartphone sales currently account for more than a half of its operating profit. A strong turnaround at the company's flat panel operation compared with a year earlier has also helped boost Samsung's bottom line, analysts said.
"For the third quarter, we forecast revenue and operating profit will stand at record highs of 54 trillion won and 8.5 trillion won, respectively, thanks to the effect of Galaxy S III on the handset and component divisions," Nomura analyst CW Chung said.