SEOUL – Samsung Electronics posted record quarterly profit of $5.15 billion, driven by booming sales of its smartphones and the Galaxy Note "phablet," which it hopes will show it has a flair for innovation to match rival Apple Inc.
The Note - part phone, part mini-tablet - with a throwback stylus and screen half the size of the iPad, has sold more than 5 million since launching in October, and is proving a surprise money earner for the South Korean electronics giant that has a reputation as a "fast follower" rather than design leader.
"Higher-than-expected shipments of the Galaxy Note seem to have given an upside to earnings," said Lee Ka-keun, an analyst at Hana Daetoo Securities. "Note sales will increase further in the second quarter, and handset profit will grow despite a rise in marketing costs related to the London Olympics."
Samsung, which raced to the top of the global smartphone rankings last year with close to a fifth of the market, from just 3 percent in 2009, is set to go head-to-head with Apple this quarter with the expected launch of a revamped Galaxy S, its flagship smartphone, and Apple’s next iPhone.
The Note sits between a small tablet and a big smartphone, and its early success illustrates that a maturing mobile device market can open new opportunities as users and manufacturers experiment with form. – Reuters