Best quarterly profit in 3 years for Samsung
> Tech giant bounces back from Note 7 debacle, driven by strong demand for its memory chips
SEOUL: South Korean tech giant Samsung Electronics posted its biggest quarterly net profit for more than three years yesterday after shrugging off the debacle over exploding Galaxy Note 7 batteries.
The results, driven by strong demand for the company’s memory chips, represented its second-largest ever quarterly profit.
Shares in the firm – the flagship subsidiary of the sprawling Samsung Group – have climbed in recent months as rising expectations overcame last year’s recall embarrassment and its vice-chairman going on trial for bribery.
But it formally dropped a reform plan yesterday that would have seen it split in two and could have made the group’s opaque structure more transparent.
Net profit for the January-March period jumped 46% from a year ago to 7.68 trillion won (RM29 billion), Samsung Electronics said in a statement. It was its biggest quarterly net profit since the record third quarter of 2013.
Operating profit jumped 48% from a year ago to 9.89 trillion won – also the biggest since the third quarter of 2013.
A breakdown of the figures showed the firm’s semiconductor business made its largest-ever operating profit of 6.3 trillion won.
Samsung – the world’s largest maker of both mobile phones and memory chips – provides its chips to other companies including archrival Apple.
It was humiliated by the Galaxy Note 7 recall last year, which cost it billions of dollars and dealt a blow to its reputation, but has just launched a new flagship device, the Galaxy S8, to positive reviews and strong orders.
Even so Samsung warned that smartphone sales may be stagnant in the second quarter due to slowing sales of low-end handsets and “intensifying competition”, with Apple set to unveil a new iPhone later this year.
Shares in Samsung Electronics – South Korea’s largest firm by value – rose as much as 2.8% to 2.2 million won in morning trade on the Seoul stock market. But the company has come under pressure on wider fronts.
Vice-chairman Lee Jae-Yong, the heir to the Samsung group, has been held in custody and is on trial for bribery, with other key executives, in connection with the sprawling corruption scandal that brought down South Korean president Park GeunHye. – AFP