Samsung revenues rocket 5.7 percent to £29.96 billion

Korean manufacturer credits success of the Galaxy S7 smartphone range, with net profits also rising 14 per cent

Samsung Electronics has credited a 5.7 per cent increase in first quarter revenues to successful early sales of its new flagship smartphone range, the Galaxy S7.

The South Korean manufacturer posted revenues of KRW 49.78 trillion (£29.96 billion) for the three months ending March 30. Net profits were up 14 per cent year-on-year to KRW 5.2 trillion (£3.16 billion).

Samsung claimed the results, which were even stronger than its initial guidance, had been driven in part by strong sales from its mobile division, which saw sales increase eight per cent on the same quarter the previous year. Sequentially, handset sales were up 12 per cent at KRW 26.94 trillion (£16.21 billion).

Samsung credited the boost in sales to the early release of the S7 and S7 edge, which were launched in Barcelona at Mobile World Congress and went on sale on March 11.

Demand for the S7 range in the UK was more than 2.5 times that of previous devices in the range, Samsung boasted in March.

In its financial release, Samsung said: “While smartphone and tablet demand saw a slight QoQ decrease due to seasonal effects, overall operating profit for the Division increased.

“This increase was largely due to the early launch and strong global performance of the flagship Galaxy S7 and S7 edge, as evidenced by robust sell-out figures and low inventory levels compared to their predecessors. A streamlined mid-to-low-end smartphone lineup also contributed to improved profitability.

The results come just days after Apple announced its first ever decline in iPhone sales, which Apple CEO Tim Cook blamed on a slowing global economy.

It its outlook for Q2, Samsung said it expects sales to flatten because of this. It also said it expects to release another flagship device later this year, rumoured to be the next iteration of its Note range.

“Looking ahead to the second quarter, while demand for smartphones and tablets is forecast to remain flat due to continued weak seasonality, the worldwide rollout of the latest flagship models as well as an increase in shipments of the mid-to-low-end Galaxy A and J series are expected to help the company maintain robust sales momentum and profit.”