LG Electronics sees slight profit increase in Q2

Steve Phelps
July 27, 2017

Samsung Electronics increased its group operating profit 73% from a year ago, hitting an all-time quarterly high of 14.07 trillion won ($12.6 billion) for the April-June period, the South Korean company said Thursday.

Indeed, nearly 60 percent of the company's quarterly income came from its semiconductor business, which recorded 8 trillion won in operating income from sales of 17.6 trillion won.

The double-digit expansion came amid strong demand for memory chips, of which profit accounted for more than half of the total operating profit in the second quarter.

In May, Samsung said it had sold over 5 million Galaxy S8 and S8 Plus units.

Though Samsung is the world's leading smartphone maker, it was bumper demand for memory chips that drove the company's earnings to new heights.

The sales revenue of the company's mobile division is also up 13 per cent to 30 trillion won following the good public reception of the latest Galaxy S8 and S8plus high-end models, but its operating profit was reduced due to an increase in component costs.

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Mobile devices and data are the keys to understanding Samsung's ascent as the new industry leader, even as its de facto chief is jailed, battling corruption charges, and it recovers from a fiasco over Galaxy Note 7 smartphones that had to be axed a year ago because they were prone to catch fire.

Lee is facing charges of bribery and corruption related to a far-reaching scandal that resulted in the ouster of former South Korean President Park Geun-hye earlier this year.

On an annual basis, Samsung's semiconductor division is widely expected to overtake Intel's sales this year, analysts at brokerages and market research firms say.

"Looking ahead to the third quarter, the company expects favourable semiconductor conditions to continue, although overall earnings may slightly decline quarter-on-quarter as earnings weaken for the display panel and mobile businesses", Asia's third most-valuable company by market value said in a statement.

A court is due to give its verdict on Lee by the end of next month.

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