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Samsung smartphone and display sales boost income

Samsung has faced a series of steep profit declines and record-breaking losses in recent quarters, but its latest earnings report expresses optimism for the future. The company attributes its improved performance in the past three months to strong sales of its flagship mobile devices and premium displays. Additionally, Samsung’s Device Solutions (DS) division, encompassing its memory and foundry businesses, has managed to narrow its losses. The company anticipates a gradual recovery in the demand for memory chips, driven by the growing popularity of artificial intelligence.

For the third quarter of 2023, Samsung has reported consolidated revenue of KRW 67.40 trillion ($49.9 billion), reflecting a respectable 12 percent increase from the previous quarter. It also posted a profit of KRW 2.43 trillion ($1.80 billion), which, while significantly lower than the KRW 10.85 trillion ($7.6 billion) earned during the same period in 2022, is a marked improvement over the $527 million profit reported in the second quarter.

In the mobile and network business segment, Samsung recorded KRW 30 trillion ($22.17 billion) in consolidated revenue and KRW 3.30 trillion ($2.44 billion) in operating profit. The third quarter saw increased demand, with the global smartphone market showing signs of recovery. Samsung attributed its previous drop in revenue to a decline in smartphone shipments, but for this period, the Galaxy S23 series maintained solid sales momentum, and sales of foldables, tablets, and wearables were strong. The company expects smartphone sales to grow in the next quarter due to the holiday season, with the market rebounding next year as consumer sentiment stabilizes in anticipation of a global economic recovery.

Another segment that performed well in the third quarter is Samsung’s mobile panel business, which saw a significant increase in earnings due to new flagship model releases by major customers, potentially including Apple’s iPhone 15. Samsung’s focus in the mobile display business remains on OLED panels, with plans to establish a supply chain targeting the augmented and virtual reality market.

Finally, Samsung’s semiconductor division reported operating losses of KRW 3.75 trillion ($2.77 billion) for the quarter, a slight improvement over the KRW 4.36 trillion ($3.23 billion) losses in the previous quarter. The company foresees an improvement in demand for PCs and mobile devices in the upcoming period and expects strong server demand from cloud service providers, driven by generative AI applications.

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