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Samsung suffered steep profit declines in the first half of 2023, with its semiconductor division reporting its first losses in 14 years. The second half of the year has begun on a more positive note for the company. The Korean firm has just published its earnings report for Q3 2023, and its profit has increased substantially.
Samsung posted its best quarter profit of the year in Q3 2023
According to Samsung’s earnings report, its total consolidated revenue for the past quarter was KRW 67.40 trillion (roughly $50 billion). The revenue has increased over 12% from the second quarter of the year when it made KRW 60.01 trillion. It is still down 12.22% from the third quarter of 2022, though. The Korean behemoth generated a revenue of KRW 76.78 trillion between July and September last year.
While that’s a notable year-over-year (YoY) drop in revenue, profit has been Samsung’s bigger problem this year. It took home only KRW 640 billion and KRW 670 billion in the first two quarters of 2023, respectively. That’s a profit margin of just 1%. In the third quarter, its profit margin increased to 3.6%. The company posted a profit of KRW 2.43 trillion ($1.8 billion) this past quarter.
The figure is still down a whopping 77% from the same period last year. Samsung posted an operating profit of KRW 10.85 trillion during the period. Its profit this year is far off the 2022 levels, but the company appears to be on the right track in recent months. The Galaxy S23 series has sold better than 2022 models. Samsung’s losses from the semiconductor division also narrowed in Q3, helping it post a higher profit than Q2.
Samsung says its Device Solutions (DS) Division, which houses the semiconductor unit, suffered an operating loss of KRW 3.75 trillion in the third quarter. It reported losses of KRW 4.58 trillion and KRW 4.36 trillion in the previous two quarters, respectively. The memory business benefitted from increased demand for high-value products, which effectively increased the average selling price (ASP).
80% of Samsung’s profit came from the display business
Samsung’s mobile display business posted “solid results” this past quarter. With an operating profit of KRW 1.94 trillion, it accounted for 80% of the company’s total profit during the period. Sales of both mobile displays and large display panels grew in Q3.
Samsung is expecting this trend to continue in the fourth quarter. It supplied displays for Apple’s iPhone 15 series and Google’s Pixel 8 series. The new Pixels also feature a Samsung-manufactured Tensor G3 processor. The Korean firm designed its CPU as well. It remains to be seen whether the company manages to post a healthier operating profit in the year-ending quarter.
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