Samsung posts record smartphone-driven profits

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The company made £3.7 billion net profit in Q3, but predicts weak future demand for PC DRAM due to oversupply

Samsung made 6.56 trillion won (£3.7 billion) net profit in the third quarter of this year, which it attributes to strong handset sales.

The company’s revenues for the three months ending 30 September were 52.18 trillion won (£30 billion), a 26 percent increase year-on-year.

For the quarter, the company’s consolidated operating profit reached an all-time high of 8.12 trillion won (£5 billion).

In a statement on its website Samsung said its “solid performance is mainly attributed to increased sales of handheld phones and stronger demand for display panels.”

It said its mobile communications business brought in revenue of 26.25 trillion won (£15 billion) for the quarter.

“Increased shipments of Organic Light-Emitting Diode (OLED) and Liquid Crystal Display panels used in tablets and smartphones, as well as TVs drove up profitability” the statement said.

Samsung’s senior vice president and head of investor relations Robert Yi said he expected market competition to intensify. He said: “we will do our best to sustain our earnings momentum throughout the fourth quarter by implementing strategies we have developed for our businesses.”

The company predicts year-end seasonality will push up demand for mobile devices including tablet PCs, as new products make their way into markets with more competitive pricing.

Year-end holiday promotions, robust demand in emerging markets and China’s New Year holiday effect are expected to shore up global demand for IT products.

It expects demand for PC DRAM will be weak due to oversupply, and sales of digital appliances will slow down due to unfavourable market conditions in developed economies.

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