Samsung, Asia's biggest electronics maker, reported lower than expected quarterly profits amid concerns that the economic slowdown will curtail consumer spending on televisions, mobile phones and computers.

The South Korean group's net profit rose 51 per cent to 2.14 trillion won (£1 billion), for the quarter ending June 30, but fell below analysts' expectations of 2.36 trillion won.

Nevertheless, the company described the result as “very strong”, and reported sales up 24 per cent to a record 18.14 trillion won. The market remained unconvinced, sending Samsung's shares down 6.2 per cent to close at 576,000 won - their biggest one-day fall in four years.

Lee Min-hee, an analyst at Dongbu Securities in Seoul, described Samsung's results as “very disappointing”, especially the weak performance in computer memory chips and LCD televisions. Profit from chips unexpectedly fell 18 per cent in the quarter.

The digital media division, which makes televisions, reported a loss of about 160 billion won in the same period. LCD prices began to decline late in the second quarter, a trend that Mr Lee said would continue. “In the second half, Samsung's profit will decrease sharply in the LCD business,” he added.

Chi Young-cho, Samsung senior vice-president, said that the company expected its market share in flat panel televisions to continue to rise. It is already the world's biggest seller.

He hoped that the company's share of the American market for LCD TVs would continue to grow, referring to the US as “a region that no one has ever treaded before”.

Lee Jae-yong, senior manager in Samsung's digital media business, put the US market share figure for LCD TVs at 29 per cent, which he said was a 10 per cent increase on the first quarter.

The mobile phone division performed better, with sales up 22 per cent to 45.7 million handsets, a slight fall from the 46.3 million units sold between January and March. Samsung, which is second only to Nokia in global sales, expects to sell 200 million phones this year.

Some analysts believe that Samsung's earnings have peaked and will fall until 2010. The slowdown around the world and its dampening effect on consumer spending has hurt other electronics makers.

Apple this week disappointed with its forecasts for profits and sales, while Sony Ericsson said yesterday that it would miss its financial targets this quarter as rising food and fuel prices in emerging markets cut into sales of mobile phones.

Samsung is Asia's third most valuable global brand after Toyota and Honda.

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