Seoul: Samsung Electronics Co. reported a 21 percent year-on-year increase in net profit for the third quarter, driven by a record performance in its semiconductor division amidst a booming artificial intelligence (AI) market. Net profit for the July-September period totaled 12.22 trillion won (US$8.6 billion), up from 10.1 trillion won in the same period last year, according to the company’s regulatory filing.
According to Yonhap News Agency, Samsung’s operating profit for the quarter surged by 32.5 percent to 12.16 trillion won, with revenue increasing by 8.8 percent to 86.06 trillion won. These figures surpassed market expectations, as analysts had projected an average net profit of 10.13 trillion won, based on a survey by Yonhap Infomax.
The semiconductor division’s operating profit soared to a record 7 trillion won, up from 400 billion won in the second quarter and 3.9 trillion won in the third quarter of the previous year. This growth was largely attributed to the strong performance of high bandwidth memory (HBM) products. Samsung noted that it achieved record-high quarterly revenue in its memory business by expanding HBM3E sales, driven by robust demand across various applications.
The company emphasized its proactive approach in meeting the demands of the AI industry with its cutting-edge memory products, including HBM3E and high-density eSSDs. Samsung also highlighted its plan to expand sales of its premium mobile lineup, including tablets and wearables, in response to increasing market demand.
Samsung’s DX division, which encompasses mobile, TV, and home appliance businesses, reported an operating profit of 3.5 trillion won, supported by the popularity of foldable smartphones. The mobile sector alone posted an operating profit of 3.6 trillion won, buoyed by the successful launch of the Galaxy Z Fold 7 and growing sales of tablets and wearables.
However, the visual display segment faced challenges, recording an operating loss of 100 billion won due to intensified competition. Despite this, Samsung remains optimistic, expecting the AI boom to positively impact all business arms, including chips and smartphones, in the fourth quarter.
Samsung announced plans to significantly expand its HBM production capacity to meet increased client demand and has secured customers for next year’s HBM production. The company projected its 2023 facility investment to reach 47.4 trillion won, with the semiconductor division accounting for 40.9 trillion won. These investments aim to transition to advanced processes for high-value-added products and upgrade existing production lines.
Samsung’s commitment to innovation is reflected in its accumulated investment in research and development, which reached 26.9 trillion won by the end of September. The company’s shares closed at 104,100 won, marking a 3.58 percent increase from the previous session, outperforming the main bourse’s 0.14 percent gain.