Samsung Electronics said its first quarter net profit plunged 39 percent as consumers switched to new iPhones, despite a surge in memory chip demand. Samsung's revenue for the quarter was KRW 47.12 trillion, an 11 percent decrease quarter-on-quarter (QOQ), while the operating profit for the quarter also fell 29.6 percent on-year to 6.0 trillion won. The world's top handset maker reported a net profit of 4.6 trillion won ($4.3 billion) for the January-March period, down 38.9 percent from a year earlier.

During the first quarter, Samsung's Memory Business further accelerated its 20-nanometer class migration for DRAM, while DDR4/LPDDR4 sales increased for mobile devices and servers. The Display Panel segment saw profit growth, as OLED panels for smartphones and LCD panels for premium TVs saw increased sales. The Mobile Business also saw profit growth, due to increased sales of new middle- to low-end smartphones, all the while decreasing marketing expenditures.

In the second quarter, the company expects its overall earnings to increase compared to the previous quarter, despite an expected growth in marketing expenditures. With premium smartphone sales entering into full swing, sSmsung expects to see high demand for its semiconductor products. The company's System LSI Business is expected to improve its overall business performance through increased supply of 14-nanometer application processors. The Display Panel segment expects smartphone and TV sales to boost its earnings from OLED and LCD panel sales. The IM Division earnings are expected to grow, due to increased global sales of the Galaxy S6 and S6 edge. Meanwhile, the Consumer Electronics (CE) Division expects to see improvements, as seasonality should improve air conditioner sales, while the flagship SUHD TV sales are expected to increase.

Looking ahead to the rest of 2015, despite strong seasonality, Samsung expects competition to toughen for the set business. For the component business, while Samsung expects stable supply and demand conditions, weak demand for set products and increase in LCD panel supply may negatively affect earnings. While the information technology (IT) industry has typically had a weak 1H and a strong 2H each year, this may be less so for 2015.

In related news, Samsung overtook Apple to recapture the title of world's top smartphone maker by volume in the first quarter of 2015, research firm Strategy Analytics said on Wednesday.

It said Samsung shipped 83.2 million smartphones worldwide and captured 24 percent market share in the quarter, down from 31 percent a year earlier but better than Apple's 18 percent.

"Samsung continued to face challenges in Asia and elsewhere, but its global performance has stabilized sufficiently well this quarter to overtake Apple and recapture first position as the world's largest smartphone vendor by volume," Strategy Analytics Executive Director Neil Mawston said in a statement.

Apple shipped 61.2 million smartphones worldwide and captured 18 percent marketshare in Q1 2015, rising from 15 percent in Q1 2014. Apple's new iPhone 6 and 6 Plus models remain wildly popular in China and worldwide.