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Samsung phones boost as profits dip

Electronics giant Samsung has reported a 23% fall in quarterly profits as weaker demand for computer chips offset booming smartphone sales that were estimated to have surpassed those of industry pioneer Apple.

Samsung, the world's biggest manufacturer of memory chips and liquid crystal displays, said it earned 3.44 trillion won (£1.93 billion) in the three months ending September 30, down from 4.46 trillion won (£2.49 billion) a year earlier.

But the company said its telecommunications business hit a record in quarterly sales of 14.9 trillion won (£8.3 billion) - a 37% increase from last year - with growth mainly due to strong Galaxy smartphone sales.

Jae Lee, a Daiwa Securities technology analyst, estimated that Samsung had shipped about 28 million smartphones in the third quarter, up from about 20 million last quarter, and had surpassed Apple's iPhone sales.

Lee expects strong sales in the next three months as Samsung continues to focus on an array of smartphone products.

Samsung spokesman Nam Ki-yung would not comment on whether Samsung had passed Apple in smartphone sales, saying the company no longer provides its sales figures for handsets.

It did say, however, that handset shipments jumped more than 20% from last quarter, and global smartphones sales were up 300% from last year.

The Suwon, South Korea-based company said its handset revenues were 14.42 trillion won (£8.1 billion) in the third quarter, a 39% jump from last year, and it forecast strong sales.

The gains in smartphones came despite the firm being locked in a global patent battle with Apple, which began legal action in April against Samsung for what it says is uninhibited copying of its iPhone and iPad designs.

Apple says the product design, user interface and packaging of Samsung's Galaxy devices "slavishly copy" the iPhone and iPad. Samsung fought back with lawsuits of its own, accusing Apple of patent infringement of its wireless telecommunications technology.

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