Samsung's Profit Sink 39 Percent, Bigger iPhones To Be Blamed?

Samsung's first quarter net profit plunged 39 percent as consumers switched to bigger iPhones, squeezing earnings from its mobile business to less than half what they were a year earlier, NYT reported.

The company said its January-March net profit was 4.63 trillion won ($4.35 billion), compared with 7.49 trillion won a year earlier.

According to analysts, Samsung sold more smartphones than Apple during the quarter but it lost ground in the more profitable high-end market to Apple after the Cupertino company started offering large screen iPhones.

Apple on Tuesday reported that it sold 61 million iPhones in the first three months of the year, an increase of 40-percent from a year earlier.

Samsung did not disclose its smartphone shipments, but it's estimated to have sold 83 million smartphones during the quarter.

Samsung believes that the Galaxy S6 will drive more profits. "Galaxy S6 sales have been going as well as expected, while demand for the Galaxy S6 edge have been better than anticipated," Samsung Vice President Park Jin-young said during a conference call.

Notably, Samsung shares have slipped in recent weeks on concerns that the new flagship may not sell as well as first hoped.

"I don't see any devices within the current Android camp that could stand as an alternative to Samsung's high-end smartphones," Daewoo Securities analyst Jonathan Hwang said.