Samsung Electronics logs weaker-than-expected profit in Q3

SEOUL, Oct. 31 (Xinhua) — South Korea’s tech giant Samsung Electronics logged weaker-than-expected profit in the third quarter owing to the delayed production of memory chips used in generative artificial intelligence (AI) chipsets, the company said Thursday.
Samsung’s consolidated operating profit amounted to 9.18 trillion won (6.7 billion U.S. dollars) in the July-September quarter, up 277.4 percent compared to the same quarter of last year.
Despite the triple-digit growth, the profit missed market expectations of about 10.3 trillion won (7.5 billion dollars) on the back of Samsung’s delayed supply of high bandwidth memory (HBM) products.
Samsung said growth in AI will keep memory demand at robust levels in the fourth quarter, vowing to concentrate on driving sales of HBM and high-density memory products.
Revenue jumped 17.4 percent over the year to hit a record high of 79.1 trillion won (57.3 billion dollars) in the third quarter, while net income surged 72.8 percent to 10.1 trillion won (7.3 billion dollars).
The record revenue was attributed to the launch effects of new smartphones and strong sales of high-end memory products.
Memory demand for AI and conventional servers was strong, but demand for mobile devices was relatively soft on inventory adjustments, Samsung said.
Samsung’s foundry business saw its overall earnings decrease in the third quarter compared to the previous quarter due to the impact of one-off costs.
The company said it planned to expand sales in line with an increased HBM capacity while striving to acquire new customers for foundry business.
The display panel unit achieved an operating profit of 1.51 trillion won (1.1 billion dollars) on revenue of 8.0 trillion won (5.8 billion dollars) in the July-September quarter.
Mobile display sales improved thanks to flagship product launches by mobile device makers, and large display sales increased on stable demand for TV and monitor products.
Samsung expected a continued demand for mobile display panels and a sales growth of panels used for cars in the fourth quarter.
The mobile phone and networks business generated an operating profit of 2.82 trillion won (2 billion dollars) on revenue of 30.52 trillion won (22.1 billion dollars) in the third quarter.
Samsung projected seasonal factors to lead to sequential growth in the smartphone market in the fourth quarter.
The TV and home appliance division logged an operating profit of 530 billion won (384.1 million dollars) on revenue of 14.14 trillion won (10.3 billion dollars).
Samsung’s capital expenditure in the cited quarter totaled 12.4 trillion won (9.0 billion dollars), including 10.7 trillion won (7.8 billion dollars) in the semiconductor division and 1.0 trillion won (724.6 million dollars) in the display panel unit. ■