Earnings

Samsung Surges on Smartphone, Component Demand

Samsung Electronics posted record earnings Monday (Oct. 30), driven by strong results in its components and mobile segments and as demand for smartphones heated up.

The company said in corporate filings that net income was 11 trillion won, which bested the 10.8 trillion analysts had estimated. Sales were 62 trillion won, up 29 percent. Operating profit came in at 14.5 trillion won, nearly tripling, which was in line with previous firm guidance. Of that latter tally, the components business was 10 trillion won, and chips were of course buoyant on high demand for mobile and other high-tech devices (and it should be noted that Samsung also supplies components to competitors, such as Apple). The mobile segment contributed 3.3 trillion won, leagues above the 100 billion won seen last year.

The smartphone division, stated the company in its materials, got an earnings boost from the Galaxy Note 8 and the new J Series. In commentary about the mobile market in general, Samsung said that demand for smartphones and tablets will rise on seasonality, but that new products from competitors will “intensify competition in the premium segment.” The competitive environment is likely to persist into 2018.

In the wake of the announcement that Vice Chairman Kwon Oh-Hyun is retiring within the next few months – and former firm head Jay Y. Lee is in prison – the search for a new chief executive is still underway.

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