AFP, Seoul :
South Korean tech giant Samsung Electronics flagged a jump of more than 25 percent in Q4 operating profit Friday, with working from home under the coronavirus pandemic driving demand for the devices powered by its chips.
The world’s biggest manufacturer of smartphones and memory chips said in an earnings estimate that it expected operating profit of 9 trillion won ($8.23 billion) for October to December, up from 7.16 trillion won a year earlier.
The prediction was slightly short of analyst forecasts of 9.34 trillion won compiled by market researcher FnGuide.
The figures come about two months after the burial of late chairman Lee Kun-hee – who turned Samsung Electronics into a global powerhouse – and as the coronavirus wreaks havoc with the world economy.
But the pandemic has also seen many tech companies boom, while South Korea saw a return to quarter-on-quarter growth in Q3 last year, driven by a better-than-expected exports performance.
But Samsung’s operating profit and 61-trillion-won sales forecast were both lower than its third-quarter figures, when its mobile and chip businesses were boosted by US sanctions against Huawei.
Analysts say a stronger won and rival Apple’s October launch of its flagship iPhone 12 were among the factors behind the quarter-on-quarter decline in profits.
“Samsung’s midrange and value smartphones account for about 80 percent of its mobile sales,” said Jusy Hong, a director at market researcher Omdia.
“But Chinese firms – such as Xiomi, Vivo and Oppo – have been also expanding their share in the midrange phone market, in regions including India and Southeast Asia.”
Samsung Electronics is crucial to South Korea’s economic health.
It is the flagship subsidiary of the giant Samsung group, by far the largest of the family-controlled conglomerates known as chaebols that dominate business in the world’s 12th-largest economy.
South Korean tech giant Samsung Electronics flagged a jump of more than 25 percent in Q4 operating profit Friday, with working from home under the coronavirus pandemic driving demand for the devices powered by its chips.
The world’s biggest manufacturer of smartphones and memory chips said in an earnings estimate that it expected operating profit of 9 trillion won ($8.23 billion) for October to December, up from 7.16 trillion won a year earlier.
The prediction was slightly short of analyst forecasts of 9.34 trillion won compiled by market researcher FnGuide.
The figures come about two months after the burial of late chairman Lee Kun-hee – who turned Samsung Electronics into a global powerhouse – and as the coronavirus wreaks havoc with the world economy.
But the pandemic has also seen many tech companies boom, while South Korea saw a return to quarter-on-quarter growth in Q3 last year, driven by a better-than-expected exports performance.
But Samsung’s operating profit and 61-trillion-won sales forecast were both lower than its third-quarter figures, when its mobile and chip businesses were boosted by US sanctions against Huawei.
Analysts say a stronger won and rival Apple’s October launch of its flagship iPhone 12 were among the factors behind the quarter-on-quarter decline in profits.
“Samsung’s midrange and value smartphones account for about 80 percent of its mobile sales,” said Jusy Hong, a director at market researcher Omdia.
“But Chinese firms – such as Xiomi, Vivo and Oppo – have been also expanding their share in the midrange phone market, in regions including India and Southeast Asia.”
Samsung Electronics is crucial to South Korea’s economic health.
It is the flagship subsidiary of the giant Samsung group, by far the largest of the family-controlled conglomerates known as chaebols that dominate business in the world’s 12th-largest economy.
