SEOUL, July 31 (Xinhua) -- South Korea's tech giant Samsung Electronics saw its operating profit surge in the second quarter thanks to strong sales of semiconductors and display panels, the company said Wednesday.
Samsung's consolidated operating profit came to 10.44 trillion won (7.6 billion U.S. dollars) in the Apil-June quarter, more than 15 folds larger than 668.5 billion won (484.1 million dollars) in the same quarter of 2023.
The profit slightly topped market expectations of about 10.3 trillion won (7.5 billion dollars).
Revenue soared 23.4 percent over the year to 74.07 trillion won (53.6 billion dollars) in the second quarter, and net income more than quintupled to 9.84 trillion won (7.1 billion dollars).
The positive earnings came as favorable memory chip market conditions drove average sales price higher in addition to robust sales of OLED panels.
The chip-making business recorded an operating profit of 6.45 trillion won (4.7 billion dollars) on revenue of 28.56 trillion won (20.7 billion dollars) in the second quarter.
The outperformance was driven by solid demand for HBM, conventional DRAM and server SSDs that stemmed from the continued artificial intelligence (AI) investments by could service providers and the growing demand for AI from businesses for their on-premise servers.
Higher supply of systems on chips (SoCs), image sensors and display driver ICs (DDIs) also contributed to the chip business earnings.
The company expected demand to remain solid across the board from HBM and DDR5 to server SSDs in the second half of this year.
Samsung's display panel unit achieved an operating profit of 1.01 trillion won (731.4 million dollars) on revenue of 7.65 trillion won (5.5 billion dollars) in the April-June quarter.
Sales of mobile display panels rose on the back of solid demand for flagship products and stable supply of IT OLED products, while sales of large display panels expanded on demand for high-resolution, high-refresh-rate monitor in the gaming monitor market and the increased penetration of OLED panels in the TV market.
In the second half, the release of new smartphones and potential replacement demand with the adoption of AI were forecast to lead to an increase in mobile display sales.
The mobile phone and networks business generated an operating profit of 2.23 trillion won (1.6 billion dollars) on revenue of 27.38 trillion won (19.8 billion dollars) in the second quarter.
Overall market demand for smartphones declined on seasonal trends, but the Galaxy S24 series saw a double-digit on-year growth in both shipment and revenue over its predecessor, Samsung noted.
The company projected smartphone demand to go up in the second half thanks to AI-driven demand for premium products and the launch of new products.
The TV and home appliance division logged an operating profit of 490 billion won (354.8 million dollars) on revenue of 14.42 trillion won (10.4 billion dollars).
Overall TV demand climbed in the second quarter due to global sporting events, and the TV demand was predicted to recover further in the second half owing to higher demand for QLED, OLED and larger screen TVs.
Samsung's capital expenditure in the cited quarter totaled 12.1 trillion won (8.8 billion dollars), including 9.9 trillion won (7.2 billion dollars) on the semiconductor division and 1.8 trillion won (1.3 billion dollars) on the display panel unit. ■
