Samsung Electronics’ operating profit falls 77.6 pct in Q3

SEOUL, Oct. 31 (Xinhua) — South Korea’s tech firm Samsung Electronics posted a double-digit fall in its third-quarter earnings as weaker global demand for locally-made semiconductors led to a large deficit in the chip-making division, the company said Tuesday.

The consolidated operating profit plunged 77.6 percent over the year to 2.43 trillion won (1.8 billion U.S. dollars) in the July-September quarter.

It topped market expectations of about 1.84 trillion won (1.4 billion dollars).

Revenue declined 12.2 percent to 67.4 trillion won (50 billion dollars), and net income tumbled 37.8 percent to 5.84 trillion won (4.3 billion dollars).

Samsung’s chip-making business recorded an operating loss of 3.75 trillion won (2.8 billion dollars) on consolidated revenue of 16.44 trillion won (12.2 billion dollars) in the third quarter.

The semiconductor business kept an operating loss for the third consecutive quarter, totaling a loss of 12.69 trillion won (9.4 billion dollars) for the first nine months of this year.

Losses from memory chip business continued to fall due to higher average selling prices and the sale of high-value-added products, but earnings in system semiconductors were impacted by a delay in demand recovery, the company said.

Samsung noted that its foundry business achieved a record quarterly backlog from design wins, expecting memory chip demand to gradually recover on the rising demand for artificial intelligence (AI) and the normalizing inventory levels.

Samsung’s display panel unit logged an operating profit of 1.94 trillion won (1.4 billion dollars) on revenue of 8.22 trillion won (6.1 billion dollars) in the July-September quarter.

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Earnings from the sale of mobile panels advanced on the back of seasonal demand and the launch of new products by major smartphone makers, while the large panel business narrowed losses in the quarter.

Samsung forecast that strong mobile panel performance would be maintained in the fourth quarter thanks to solid demand for premium OLED panels for smartphones.

The mobile phone and networks business registered an operating profit of 3.30 trillion won (2.4 billion dollars) on revenue of 30 trillion won (22.3 billion dollars).

Samsung said the mobile phone business achieved robust results due to recovery in the global smartphone market and the successful launch of new flagship models while the networks business revenue declined as mobile operators scaled back investments.

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