Seoul, April 30 Samsung Electronics said on Wednesday its first-quarter net profit rose more than 20 percent from a year earlier, driven by strong sales of its new Galaxy S series smartphones, but its flagship semiconductor business remained sluggish.
In a regulatory filing, the company posted a net income of 8.22 trillion won ($5.7 billion) for the January-March period, up 21.7 percent from 6.75 trillion won a year earlier.
The earnings exceeded market expectations. The average estimate of net profit by analysts stood at 5.17 trillion won, according to a survey by Yonhap Infomax, the financial data firm of Yonhap News Agency.
Operating profit stood at 6.68 trillion won, up 1.2 percent from a year ago, while revenue rose 10 percent to 79.14 trillion won, marking an all-time quarterly high.
Samsung Electronics attributed the larger-than-expected bottom line to robust sales of the smartphone business. Its latest Galaxy S25 smartphones debuted in January.
Its DX division, which includes mobile, TV and home appliances businesses, saw its sales jump 28 percent on-year to 51.7 trillion won, with 4.7 trillion won in operating profit.
In particular, the mobile business alone posted 37 trillion won in sales and 4.3 trillion won in operating profit.
However, sales of the company's chip division sank 17 percent to 25.1 trillion won, with 1.1 trillion won in operating profit, due to its lackluster performance in the high bandwidth memory (HBM) sector.
Samsung Electronics said its earnings could improve in the second half of 2025 if global economic uncertainties ease.
"Assuming that the uncertainties are diminished, the company expects its performance to improve in the second half of the year," it said in a release.
The company anticipated the growing demand for AI servers and on-device AI to drive growth in its memory business.
To meet this demand, Samsung Electronics plans to boost its competitiveness with upgraded 12-layer HBM3E chips and premium memory products, such as LPDDR5X.
In mobile, Samsung Electronics is set to launch the ultra-slim Galaxy S25 Edge in June and new foldable Galaxy Z series models in July to sustain momentum.
Samsung Electronics said it is in talks with multiple customers regarding its sixth-generation HBM4 chips, which it plans to mass produce in the second quarter.
The company has previously described HBM4 as a potential game changer in the HBM market, where rival SK hynix currently holds the lead.
"It is hard to predict the business environment and devise responsive measures due to rising uncertainties stemming from unpredictable U.S. tariff policies and geopolitical issues," Park Soon-cheol, chief financial officer (CFO) at Samsung Electronics, said during an earnings call.
"We will deal with any situation by leveraging our global production bases and customer management capabilities," he added.
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