Samsung said that sales in its mobile unit were KRW34.58 trillion ($31.1 billion) in the second quarter of 2013, up 54.2 per cent year-on-year, with “solid” shipments of its flagship Galaxy S4 smartphone, although increased spend took its toll on  margins.

But, according to research firm Strategy Analytics, with Apple seeing “lacklustre” volumes for its iPhone 5 coupled with weakness in China, Samsung’s handset operating profit is likely to have surpassed that of its rival, meaning the South Korean company has “finally succeeded in becoming the handset industry’s largest and most profitable vendor”.

Samsung does not break out profits for its mobile unit, but for its IT and Mobile unit (of which mobile makes up 97 per cent of sales), the quarterly operating profit was KRW6.28 trillion, up 52.1 per cent year on year. Sequentially, however, the IT/Mobile unit saw a 3 per cent drop in operating profit, on an 8 per cent increase in sales.

In a presentation, Samsung attributed the profit decline to issues including costs associated with new product launches, spending on research and development, and retail channel costs.

Samsung said that in a market impacted by “weak seasonality”, it saw its smartphone volumes increase off the back of the S4 launch, and with regional growth in the Americas and China. It also expanded its tablet line, with the launch of the Galaxy Note 8.0.

For the networks unit, Samsung said its earnings fell year-on-year due to delayed LTE investments by some operators.

Looking forward, Samsung said it expects “balanced growth” in the smartphone market, with LTE demand driving developed markets (and competition for year-end promotions), and mass market smartphone growth in emerging markets, including China.

For tablets, Samsung also expects high growth in both developed and emerging markets, against a backdrop of intensified competition driven by new product launches.

On a group level, the company reported a net profit of KRW7.77 trillion, up 49.7 per cent year-on-year, on sales of KRW57.46 trillion, up 20.7 per cent.