Sat, Oct 26, 2013 - Page 15 News List

Chips, cheaper handsets help boost Samsung profit

AP, SEOUL

South Korean students visit the Samsung Electronics gallery at the company’s headquarters in Seoul yesterday.

Photo: EPA

Samsung Electronics Co reported another record quarterly profit, as a revival in its semiconductor business and strong shipments of cheaper handsets offset flat sales of high-end smartphones.

The South Korean company, which is the world’s largest maker of smartphones, memorychips and televisions, yesterday said its July-September net profit rose 25 percent over a year earlier to 8 trillion won (US$7.5 billion).

It was the seventh quarter in a row that Samsung posted record earnings. Growth was driven by semiconductors and sales of cheaper smartphones in contrast to previous quarters that relied on premium smartphones.

Third-quarter profit from its semiconductor business doubled over a year earlier to 2.06 trillion won, as demand rose for chips used in mobile devices, servers and digital game consoles.

Samsung’s mobile business posted a record profit, contributing nearly 70 percent of the company’s total operating profit.

However, growth in sales of premium smartphones, the Galaxy S4 and the Galaxy Note 3, came to a halt during the third quarter, staying at the same level as the previous quarter.

In the premium market, Samsung is feeling the heat from the launch of Apple’s latest phone. Counterpoint Technology Market Research said Samsung’s smartphone market share in the US fell to 29 percent last month from 37 percent in August, yielding the top spot to Apple, whose share surged to 39 percent thanks to the iPhone 5S.

Samsung forecast that growth in overall smartphone sales would remain low at less than 5 percent during the final three months of this year, as competition heats up during the peak season for consumer electronics.

Meanwhile, it is seeking to narrow Apple’s lead in tablet computers. It forecast more than 20 percent growth in sales of tablets from the third quarter after its tablet business posted about a 25 percent increase in shipments last quarter.

Samsung’s sales and operating profit were also at record levels.

Sales rose 13 percent to 59 trillion won, while operating profit of 10 trillion won was up 26 percent, the company said.

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