SEOUL, South Korea (AP) – Samsung Electronics Co. said its first quarter net profit plunged 39 percent as consumers switched to bigger iPhones, squeezing earnings from its mobile business to less than half from a year earlier.
The company reported Wednesday that its January-March net profit was 4.63 trillion won ($4.35 billion), compared with 7.49 trillion won a year earlier. That was lower than the forecast of 4.97 trillion won in a survey of analysts by financial data provider FactSet.
The bigger-than-expected drop was due to a big profit plunge in Samsung’s mobile business. The maker of Galaxy smartphones said its mobile division generated 2.74 trillion won in quarterly profit compared with 6.43 trillion won a year earlier.
Analysts estimate Samsung sold more smartphones than Apple during the quarter. But the Korean firm lost ground in the high-end market to Apple after the maker of the iPhone began offering models with bigger screens last fall.
Apple on Tuesday reported that it sold 61 million iPhones in the first three months of the year, which drove another quarter of blow-out profits.