Samsung profits set to jump 50% despite mobile mess

The Samsung money-making machine is showing remarkable resilience in the face of mobile missteps and a Korean corruption probe.

Announcing its earnings guidance for Q1 2017 the company said it expects to bring in around 50 trillion Korean Won (~$44 billion) of which it expects around a fifth to be operating profit. This time last year it brought in a similar amount of revenue but the operating profit margin was just 13%, so the company has massively increased profitability in that time – increasing it by around 50% year-on-year.

The irony is that a lesser reliance on smartphones forced upon the company by the total recall of its flagship Note7 device may have played a significant part in this greater profitability. All Android smartphone vendors suffer from tiny margins, while Samsung seems to be going from strength to strength on the components side of things.

Samsung groups things like DRAM chips and displays in its Device Solutions business unit and as you can see from the hastily assembled annual numbers spreadsheet below, DS has been its fastest growing unit for sales and delivers by far the best margins. Mobile, by contrast, has been going in the opposite direction.

Samsung numbers spreadsheet

Tags: ,

Leave a comment

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.