Samsung Electronics reported a near doubling in third-quarter profits thanks to continued strong growth at its handset division. Net profit rose 91 percent from a year earlier to KRW 6.56 trillion, and sales increased 26 percent to KRW 52.18 trillion.
The mobile communications division was the main contributor, growing sales 67 percent to KRW 29.92 trillion and more than doubling operating profit to KRW 5.63 trillion versus KRW 2.42 trillion a year ago. Samsung attributed the strong results to sales of high-end phones such as the Galaxy S III and a better product mix.
While it did not release figures, it said handset shipments as well as the average selling price were up versus Q2. That includes "significant" growth in smartphone sales as well as a slight increase in feature phone shipments, the company said. Samsung estimates the smartphone market grew in the low teens versus Q2, while the feature phone market was up around 10 percent from the previous quarter. At the company's network equipment activities, Samsung said LTE shipments were up but margins declined due to price pressure.
At the semiconductor division, sales fell 8 percent from a year ago to KRW 8.72 trillion, as solid demand for mobile and server DRAM could not offset weakness in the PC market. Memory sales overall were down 5 percent to KRW 5.22 trillion. The consumer electronics division posted a small increase of 2 percent in sales to KRW 11.60 trillion, helped by growing LED TV sales, and display panel sales rose 19 percent to KRW 8.46 trillion, driven by OLEDs for the mobile segment.
Samsung said the macroeconomic environment remained difficult in the US and Europe and the company expects competition to intensify. The company expects strong year-end demand around the holidays, especially as new, cheaper tablets hit the market, while strong demand in emerging markets and around the Chinese New year should support sales of IT products. The PC DRAM market is expected to remain weak due to oversupply, while sales of consumer electronics will also likely slow due to weak demand in developed countries.
