Samsung Electronics breaks 8 trillion won mark in Q3

Samsung Electronics said Friday that it logged a record-breaking operating profit of 8.12 trillion won for the third quarter, boosted by its strong sales of mobile devices and display panels.

The world’s top smartphone maker also achieved 52.18 trillion won in revenue, an increase of 26 percent year-on-year. Net profit also posted at 6.56 trillion won from July-September.

The figures were similar to those released in its earnings guidance earlier this month which said the company’s consolidated revenue would reach about 52 trillion won and that its operating profit will amount to 8.1 trillion won.

“In the third quarter, our growth profit includes year-on-year as well as quarter-on-quarter on highly value-added products such as smartphones and OLED panels,” said Robert Yi, senior vice president of investor relations, in its quarterly earnings call.

Stating that the tablet PC products are the firm’s new growth driver, Samsung’s mobile business unit -- officially named IT and mobile communications division -- reached nearly 30 trillion won in sales and 5.63 trillion won in operating profit.

The division took up 69 percent of the Korean IT giant’s total profit for the third quarter, backing up claims with its figures that Samsung is the world’s top smartphone maker.

The earnings figures improved for its display business with increasing demand from many IT firms scheduling to unveil their own tablet PCs running on Google’s Android and Microsoft’s Windows 8 mobile operating systems.

“Increased shipments of organic light-emitting diode and liquid-crystal display panels used in tablets and smartphones as well as TVs drove up profitability,” its officials said.

However, business was rather slow for its consumer electronics and device solutions divisions, which includes its TV business.

Samsung, the No. 1 player in flat-screen TVs, said the portion of LED TVs rose to about 90 percent in the third quarter compared to the second quarter’s 80 percent.

The semiconductor sector also decreased 8 percent in sales quarter-on-quarter, recording a total of 8.72 trillion won.

“The business environment remained difficult with global economic uncertainties persisting amid the fiscal concerns in the US and Europe,” said Yi.

On the other hand, the company’s operational cash flow was set at 11.54 trillion won from July-September, up 5.6 trillion from the previous quarter. It also spent 4.5 trillion in capital expenditure, which includes 2.1 trillion won in semiconductor and 1.1 trillion won in display panel.

By Cho Ji-hyun
(sharon@heraldcorp.com)