Samsung reports the highest profit in three years with a surge in chip demand

Samsung Electronics reported the highest quarterly profits in three years and said the global chip crisis will continue next year, but the results could not alleviate concerns about its long-term strategy.

The world’s largest manufacturers of computer chips, smartphones and electronic displays have benefited from the surge in demand during the Covid-19 pandemic, but as workers begin to return to the office and the economy resumes, chip prices will rise. I’m under pressure.

Samsung’s net profit increased 31% to 12.3 trillion won ($ 10.4 billion) in the July-September quarter, as sales increased 10% to a record high of 74 trillion won.

The company warned that parts shortages for some customers could impact demand in the fourth quarter, and warned of uncertainty next year due to supply chain disruptions and rising raw material prices.

Samsung expects consumer electronics sales to decline as it expects to spend less time at home in 2022, but smartphone sales fell in the previous quarter due to the popularity of its flagship foldable device. After increasing, it is optimistic to increase.

Samsung’s share price rose 0.3% after the results were announced and fell 12% this year. Investors are concerned that the company’s strategy and chip cycle may change.

SK Securities analyst Kim Young-woo said, “Given the potential for stagflation and energy price volatility, home appliance sales are likely to stagnate next year.”

Samsung said it was convinced that the slowdown in the chip market was “not likely to be deep and long.”

Legal issues Group leader Lee Jae-yong After bribeing former President Park Geun-hye and serving 19 months in prison, he was released from prison in August and put pressure on the company.

Lee Seung-yuop was also fined Won 70m for illegal use of sedatives after admitting that he had used propofol 41 times in five years.

He faces another trial of alleged financial crimes related to. 2015 merger Of two Samsung units allegedly helped him strengthen control of the group. Lee and the company denied cheating.

Lee’s sentence was shortened as follows: poll Koreans have shown that they believe that his leadership is needed to drive large-scale investment in the global battle for semiconductor hegemony.

However, Samsung has not made a final decision on plans to build a $ 17 billion semiconductor plant in the United States, and the group’s acquisition activity has stagnated since it acquired car supplier Harman for $ 8 billion in 2017. I am.

“M & A does not seem to be a priority at this time, as Lee is still involved in legal issues,” said an industry analyst. “Investors are still in the dark on long-term growth strategies, including M & A. The company has no direction and there seems to be no clear strategy for new growth drivers.”

Weekly newsletter

Your important guide to the billions that have been created and lost in the Asian Tech world.Exclusive news, vivid analysis, smart data, a carefully selected menu of the latest technical topics from FT and Nikkei

Sign up here with just one click

Samsung reports the highest profit in three years with a surge in chip demand

Source link Samsung reports the highest profit in three years with a surge in chip demand

Back to top button