Samsung Electronics posted a near 40 per cent fall in first-quarter net profit yesterday, missing analyst estimates despite a surge in memory chip demand that cushioned a slump in smartphone sales. Facing increasing competition from arch rival Apple and smaller Chinese manufacturers, the world's top handset maker reported a net profit of 4.6 trillion won (HK$33.3 billion), down 38.9 per cent year on year. It was the fourth straight quarterly decline in net profit and missed the 4.9 trillion won average of 23 analyst estimates compiled by Bloomberg. Operating profit fell 29.6 per cent year on year to 6.0 trillion won, largely in line with the firm's earlier forecast. But in a sign that the South Korean electronics giant might be turning a corner, the operating profit was up 13.1 per cent from the fourth quarter of last year. The firm's latest earnings still stood in stark contrast to Apple which this week reported a 33 per cent surge in net profit to US$13.6 billion in the first quarter thanks to blockbuster sales of the iPhone 6, especially in the Chinese market. In its earnings statement, Samsung said it expected overall earnings to increase in the second quarter as premium smartphone sales entered "into full swing". The company shipped 99 million handsets globally in the first quarter - more than 80 per cent of them smartphones, said Robert Yi, Samsung's head of investor relations. Handset shipments in the second quarter were expected to remain at the same level, he added. Samsung is pinning its hopes on the sixth edition of its flagship high-end smartphone launched in April. The Galaxy S6 and S6 Edge with a wraparound screen received rave reviews but Samsung cautioned competition would intensify in rapidly growing emerging markets. "In 2015, continued growth is expected due to the growth of emerging smartphone markets such as China and India as well as the global expansion of the LTE business," it said. "However, increased competition in the middle- to low-end market … may present challenges." Recent media reports suggested initial sales of the Galaxy S6 and Edge had fallen short of expectations, but Park Jin-Young, deputy head of communications at Samsung's mobile unit, said both models were performing well. "I think the S6 will become the best-selling model among the Galaxy S series," Park said, adding that Samsung was struggling to meet bigger than expected demand for the Edge. Operating profit of the firm's key mobile unit dropped more than 57 per cent year on year to 2.74 trillion won in the first quarter but was up nearly 40 per cent from the fourth quarter of last year.