Samsung sees 17m phone sales
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Samsung aims to lift first quarter phone sales 10 percent.
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SEOUL, South Korea (Reuters) -- Samsung Electronics, the world's third-largest maker of mobile phones, says it expects to sell 17 million cell phones in the first quarter, up 10 percent from the previous quarter.
Despite the higher sales estimate, analysts said Thursday Samsung's numbers seemed conservative and were below their own forecasts of around 19 million units.
"We expect to sell around 17 million mobile phones in the first quarter," a company source told Reuters. "The expected rise is on the back of a fast-growing global handset market. We also expect healthy demand from Europe's emerging markets."
Samsung, which has wooed consumers with sleek, folding mobiles incorporating colour screens and cameras, has aggressively sought sales in emerging markets as well as from pickier customers in rich countries, putting pressure on rivals Nokia and Motorola Inc.
Mobile phone makers are benefiting from booming emerging markets such as China, India, Brazil and Russia, where they sell relatively cheap handsets to first-time buyers, as well as from existing customers in the United States, Europe, Japan and South Korea, who are replacing old models.
Samsung sold 15.5 million handsets in the fourth quarter of 2003 and it aims to sell 65 million cell phones this year, up 16.9 percent from 55.6 million last year. The handset division accounted for about a third of Samsung's profit and sales in the fourth quarter.
Shares in Samsung Electronics, Asia's biggest technology firm with a market value of $77 billion, are up 0.55 percent at 552,000 won Thursday afternoon.
The stock has risen 22 percent so for this year, beating a nine percent rise in the broader market, as investors eyed its bullish earnings outlook.
"Samsung's handset shipments are growing strongly in the first quarter. The company's GSM exports to Europe are showing the strongest growth given new model launches and the weak Korean won against euro," said Koo Bon-jun, an analyst at Smith Barney.
Smith Barney, a unit of Citigroup, raised this week its first-quarter sales forecast to 19.3 million from 16 million, adding Samsung's export and domestic average selling prices are slightly up thanks to increased high-end phone sales.
Reflecting the stronger average price, the investment bank raised Samsung's first-quarter handset operating margin to 22.5 percent from 19.7 percent.
Deutsche Bank said it saw Samsung's first-quarter shipments at 19 million and 2004 at 75 million.
"This is particularly impressive given that globally handset shipments in the first quarter historically fell 10-20 percent quarter on quarter owing to weak seasonality," Deutsche Bank said in a note to clients.
Copyright 2004
Reuters. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
