Samsung Electronics sees record quarterly profit

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Samsung Electronics sees record quarterly profit

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Samsung Electronics, the world’s largest computer?memory-chip maker, posted record 6.72-trillion-won ($5.9-billion) operating profits for the second-quarter, a 48 percent from a year earlier, thanks to Galaxy smartphone sales, the company said in an earnings report released yesterday.

It is the first time a Korean company had quarterly operating profits that exceeded 6 trillion won.

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Samsung Electronics’ net profit reached a record 5.2 trillion won in the April-June period, compared with 3.5 trillion a year earlier, according to the regulatory filing by the company.

Its Q2 sales climbed 21 percent on-year to an all-time high of 47.6 trillion won, while operating profit jumped 79 percent to a record 6.72 trillion won, as predicted in Samsung’s preliminary estimate earlier this month.

The strong figures were driven by robust exports of Samsung’s flagship Galaxy S3 smartphone, with global sales topping the 10-million-units mark in less than two months since its official release in May.

“Despite a difficult business environment, we achieved stable profits in the second quarter through our differentiated products and competitive technology,” said Robert Yi, Senior Vice President and Head of Investor Relations.

Samsung shares surged more than 5 percent yesterday to 1.23 million won on the Seoul bourse. The share price hit a record high of 1.42 million won on May 2.

Samsung posted solid sales and profit in the second quarter across all business segments except for semiconductors.

Samsung’s consumer electronics division reported an operating profit margin of 6.3 percent, the highest since the third quarter of 2009. Its TV sales remained flat, but its profit margin rose due to more sales of premium models.

Samsung’s chip division, the world’s biggest chipmaker, recovered from a sharp decline in operating profit in the first quarter. The division saw an operating profit margin of 12.9 percent, up from 9.5 percent in the first quarter.

Thanks to smartphones and tablet sales, Samsung expects solid demand in the third quarter for its chips used in mobile devices.

Its display component units also reported an operating profit margin of 9.1 percent, the highest since the second quarter of 2010.

“Despite economic uncertainties, Samsung will enhance the competitiveness of our main businesses and reinforce our value-added, differentiated products as means to improve earnings,” said Yi.

However, there are rising concerns over Samsung’s growing dependence on smartphone sales.

By Kim Jung-yoon [kjy@joongang.co.kr]

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