Samsung Electronics posts record $8.3-bn profit in Q4

SEOUL: Samsung Electronics, the world's largest maker of mobile phones and TVs, reported higher-than-expected fourth-quarter earnings as sales of Galaxy smartphones withstood the debut of Apple's iPhone 5.

Operating profit rose 89% to a record 8.8 trillion won ($8.3 billion) in the December quarter, Samsung said in a statement of preliminary results on Tuesday.

That compares with the 8.5 trillion-won average of 35 analyst estimates compiled by Bloomberg. The Suwon, South Korea-based company didn't give net income or divisional figures. Sales jumped 18% to 56 trillion won, helped by demand for Galaxy Note II and Galaxy S III phones.

Earnings at the mobile-phone unit probably doubled from a year earlier, according to a Bloomberg News survey of five analysts, while sales of iPhone 5s were hit by glitches with mapping software.

"Samsung was the major beneficiary of slower-than-expected sales of Apple's iPhone 5," James Song, an analyst at Daewoo Securities in Seoul, said. "The biggest challenge ahead is whether it can maintain its competitiveness in the smartphone market as high-end products are expected to be released by big players like Apple and Google."

Samsung sold about 62 million smartphones in the quarter, compared with Apple's 45 million, according to a Daewoo estimate. The South Korean company is in a global patent legal fight with Apple, which is also its biggest customer. The iPhone 5 went on sale in Sept. Operating profit may be 200 billion won higher or lower than Tuesday's estimate.

The company fell 1.3% to 1,501,000 won at 2 pm in Seoul trading. It surged 44% in 2012, compared with a 31% gain for Apple in New York. Earnings may have disappointed some investors because expectations were rising ahead of the statement, said Sean Kim, a Seoul-based analyst at Standard Chartered.