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Samsung DOUBLES profits on strong phone sales

Battle of the superlatives as Huawei predicts great things

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Mobile tech giants Samsung and Huawei turned up the heat on their rivals this week after the Korean electronics behemoth doubled its profits in the first quarter thanks to stellar phone sales and its Chinese rival revealed ambitious plans to sell over 100 million mobiles this year.

Samsung’s Q1 financials surpassed even its own optimistic estimates, doubling year-on-year to hit a record 5.85 trillion won (£3.2bn).

Although sales of semiconductors and TVs fell because of ‘seasonal factors’, the firm said that strong growth in display panels and mobile phones more than made up for this, with phones in particular accounting for over 70 per cent of its huge profits.

The Korean tech electronics giant pointed to ‘brisk’ sales of its smartphone/tablet hybrid device the Galaxy Note as well as the Galaxy S II smartphone – which are so impressive it feels the need to spell them out every time in CAPITALS – as key to driving the strong growth.

Meanwhile in China, Shenzhen-based telecoms equipment firm Huawei told Reuters that it expects to nearly double the number of mobiles sold last year by flogging over 100 million phones in 2012, as the firm continues with ambitious global expansion plans.

"We plan to target China, the United States, western Europe and Japan as key markets," Shao Yang, chief marketing officer of Huawei Device, told the newswire.

He also predicted that overall consumer device sales would jump from $7bn (£4.3bn) in 2011 to $30bn (£18.5bn) in five year’s time.

"This means that by that time, the revenue will be comparable to our telecom equipment business. We feel the room for growth for devices is much bigger than the telecom carrier sector," Shao reportedly added.

Given its strong growth to date, the smart money would be on Huawei coming close to achieving its ambitious goals, driven in the smartphone space by the Ascend range led by the super-thin Ascend P 1.

Although the firm posted a disappointing slump in profits its pretty sure to turn these fortunes around in 2012, although some analysts have raised doubts about its ability to make significant inroads in Western markets.

Both firms will be cheered by the news that the market for smartphones closer to home is booming, according to research firm GFK.

Singapore, Malaysia, Thailand, Vietnam, Indonesia, Philippines, and Cambodia registered spikes in demand for smartphones in Q1 2012 of anything from 40 to 400 per cent more than the same period last year, it said.

Overall the value of smartphone sales expanded 62 per cent year-on-year to reach $2.4 billion, with nearly 7.7m units shipped during the first three months of 2012. ®

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