Samsung Electronics posts better-than-expected profit in Q3
Source: Busiunion | 2019-10-09
Samsung Electronics, South Korea's tech behemoth, posted the better-than-expected third-quarter profit on upbeat earnings from smartphone and display panel businesses, a regulatory filing showed Tuesday.
The preliminary figure for operating profit was 7.7 trillion won (6.4 billion U.S. dollars) in the July-September quarter, topping market expectations of about 7.1 trillion won (5.9 billion U.S. dollars).
It tumbled 56.2 percent compared with the same quarter of last year when Samsung recorded its record operating profit, but it was up 16.7 percent from the previous quarter.
Samsung's operating profit moderately recovered this year after logging 6.2 trillion won (5.2 billion U.S. dollars) in the first quarter.
The preliminary revenue was set at 62 trillion won (52 billion U.S. dollars) in the third quarter, surpassing the market consensus of around 61 trillion won (51 billion U.S. dollars).
The revenue was down 5.3 percent from a year earlier, but it was up 10.5 percent from the prior quarter.
Detailed earnings on each business unit would be announced later this month after an external audit and the board of directors' approval.
The IT and mobile unit, which makes smartphones, was believed to have recorded positive earnings owing to strong sales of newly launched products such as Galaxy Note 10 and a foldable smartphone.
The smartphone-making division's operating profit was estimated at about 2 trillion won (1.7 billion U.S. dollars) in the September quarter. It was up some 30 percent from the previous quarter.
The display panel business was believed to have recorded an increase in both revenue and operating profit in the quarter on robust demand for flexible flat screens, caused by the release of new smartphones.
Operating profit for the consumer electronics unit was also believed to have increased in the third quarter from a year earlier on demand for a newly launched TV, market watchers said.
The chip-making division, the mainstay of Samsung, was believed to have logged a better-than-expected operating profit on the fast inventory adjustment and the product price rebound of the NAND flash memory chips.
However, the downturn in business cycle continued in the global DRAM memory chip market, limiting the recovery of Samsung's chip-making business in the quarter.
The local currency's depreciation to the U.S. dollar also made positive contribution to the third-quarter earnings of Samsung, one of the country's biggest exporters.
Samsung's ratio of operating profit to revenue was 12.4 percent in the third quarter, up from 11.8 percent tallied in the previous quarter. It was around half of 24.2 percent recorded on average in 2018.
For the first nine months of this year, Samsung's revenue amounted to 170.5 trillion won (142.5 billion U.S. dollars), down 7.6 percent from the same period of last year.
Operating profit plunged 57.3 percent to 20.5 trillion won (17.1 billion U.S. dollars) in the cited period.