They called it a couple of weeks ago, and they delivered. Those cunning dudes over at Samsung reported 48% year-on-year growth in operating profit, despite a poor performance from the mobile team.

Jamie Davies

April 27, 2017

2 Min Read
Samsung profits up 48% thanks to conscientious components

They called it a couple of weeks ago, and they delivered. Those cunning dudes over at Samsung reported 48% year-on-year growth in operating profit, despite a poor performance from the mobile team.

Group revenues for the singed Koreans was up to KRW 50.55 trillion for the quarter with profits standing at KRW 9.9 trillion, though troubles in the mobile business don’t seem to be completely in the past as revenues fell 15% year-on-year. The team do appear optimistic however, as it has stated shipments improved, partly thanks to the focus on the mid-range market with the launch of the Galaxy A 2017.

Although the global smartphone market is expected to remain relatively stagnant over the next quarter, Samsung is confident the worldwide rollout of the Galaxy S8 and S8+ will improve revenues and profitability of the unit. The second half of the year is predicted to be a bit better, as forecasts estimate there will be solid replacement demand, and the team will back up this confidence with another product launch.

While the mobile business is certainly not the gem it once was for Samsung, the components business is looking a lot more positive. Continued progress in the fields of IoT, AI and automotive is expected to drive demand for components, particularly high-performance energy-efficient memory products, SoCs and sensors, as well as flexible OLED panels for new form factors.

Samsung might be most well known throughout the world for its consumer products, but the less sexy components business is plugging the holes in the leaky ship. Q1 saw the its semiconductor and display divisions performed well, while demand for memory and display chips also saw a steady gain. The semiconductor unit in fact grew to KRW 15.66 trillion for the quarter, collecting KRW 6.31 trillion in operating profits along the way.

It may not be the glamourous and showbiz world of smartphones and consumer electronics, but perhaps the boring life of components will be well-received for the moment. After a period of exploding phones and corruption charges, Samsung might enjoy a bit of time out of the spotlight.

You May Also Like