Samsung’s operating profit up 53% supported by chip business

Samsung’s operating profit up 53% supported by chip business

Samsung Electronics Co Ltd expects a recovery in global technology device demand in 2022 after reporting its best fourth-quarter profit in four years, but challenges from supply chain issues and COVID-19 persist.

Citing Reuters (27/1), Samsung posted a 53 percent increase in operating profit in the fourth quarter to 13.9 trillion won ($11.6 billion), in line with the company’s forecast, helped by fast sales of memory chips and higher margins in manufacturing. chip contracts.

Profit in the chip business, its largest division, more than doubled from the same quarter a year earlier to 8.84 trillion won.

The world’s largest maker of memory chips and smartphones said it expects growth across its chip business this year, as well as in smartphones, although supply of non-memory chips is likely to remain tight.

For memory chips, it is expected that server demand will grow due to increased IT investment and new high-core computer processors, while demand for mobile chips is likely to increase due to the increase in 5G-capable models.

“Supplies of non-memory chips are expected to remain tight due to 5G penetration, demand for high-performance computing, increased outsourcing from chip design and manufacturing companies and continued inventory demand,” the company said.

However, analysts said gains were lower than the market had expected due to conservative memory chip shipments, R&D costs and a one-time year-end bonus.

Meanwhile, operating profit in Samsung’s mobile business rose about 9.9% YoY to 2.66 trillion won in the same quarter. Samsung said that it will unveil its latest flagship smartphone model on February 9.

In 2022, Samsung expects the smartphone market to continue to grow and the wearables market is likely to experience double-digit growth, although uncertainty remains regarding the protracted pandemic and component shortages.

Net profit rose 64% to 10.8 trillion won. Revenue rose 24% to a record 76.6 trillion won.

Business News