Samsung reported that net profit rose 50% in the second quarter with the sale of 72.4 million phones, but was below analysts' expectations, Jungah Lee writes. Increasing competition in the high-end smartphone market and the need for greater marketing spending and R&D is squeezing margins for phone-makers. As a result, Samsung announced plans to increase investment in its chip and display businesses. The company reported a 71% gain in its chip business in Q2. "Samsung is trying to make its profit structure largely balanced," said CIMB Group Holdings' Lee Do Hoon. "Samsung's smartphone margin may decline in the future but the components businesses, either chips or displays, will become a major profit driver to help it sustain the overall profit."

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