Samsung profits decline for first time in three years as smartphone sales fall

The South Korean electronics giant now makes more profit from semi-conductors than mobiles

Samsung Electronics' headquarters in Seoul (Reuters)

Samsung Electronics’ decreasing smartphone sales saw it post its first decline in annual profits for three years, a day after archrival Apple’s iPhone success helped it to post the biggest quarterly profit made by a public company.

Samsung - which has another version of its flagship Galaxy smartphone expected out this spring - saw revenues from its mobile division fall to 25 trillion won (£15.1 billion) in the final quarter, and full-year sales were down 21 per cent on a year earlier.

It was a fifth consecutive quarter of decline for Samsung’s mobile division - even though its devices at present retain the title of the biggest sellers in the world.

Apple sold a record-breaking 74.5 million iPhones in the last three months of last year, as the business’s fans hurried to stock up on its big-screen iPhone 6 and 6 Plus.

Analysts now reckon that Samsung’s best-selling position is under threat - both from Apple and from Chinese firms making cheap rival devices.

The South Korean electronics giant now makes more profit from semi-conductors than mobiles, but its overall pre-tax profit for 2014 still fell 27 per cent to 27.9 trillion won - the lowest since 2011.