Samsung Electronics – the South Korea-based tech giant – has posted record-breaking earnings despite the disaster it had last year with its Galaxy Note 7. With its earnings, the South Korean smartphone maker is said to compete with the quarterly profits of the Silicon Valley giant.
Samsung holds an important place in its customer’s heart
The tech giant had gone through a damaging recall debacle and a bribery scandal but it is still important for its customers. The brand name of Samsung has some pretty loyal customers and according to the smartphone maker, there was huge sales of its new Galaxy S8 smartphone and demand for its memory chips in April and June. The smartphone making giant has predicted another amazing report for the current quarter to September.
The South-Korea based smartphone maker said that operating profit of the company soared “forecast-beating 72.9pc from the previous year to 14.07 trillion won (£9.6bn), compared with consensus forecasts of $10.6bn (£8bn) for US titan Apple, which is due to report next week,” according to a report by telegraph.co.uk. In an interview to AFP, Greg Roh, an analyst at HMC Investment Securities said that the South-Korean company has surpassed its competitors for now, however, the tech giant – Apple – usually “sees little fluctuation in its profits whereas Samsung’s profits fluctuate largely on memory chip prices.”
The shares of the smartphone maker ended down 0.08 percent in Seoul. One of the most popular maker of smartphones and memory chips worldwide said that net profits surged around 90pc to 11.05 trillion won, which is the best quarterly result in five years.
Samsung to invest 20.4 trillion won by 2021
Before the announcement, Bryan Ma, a technology industry analyst at IDC, said “The S8 has indeed helped get Samsung back onto its feet, hopefully putting the Note7 debacle behind it. But we also have to keep in mind that a lot of Samsung’s momentum is from memory and displays too, so it’s not all about the S8, either,” according to Bloomberg News.
The smartphone maker is set to unveil its new Galaxy Note 8 device next month, which is only a year after the exploding battery crisis that forced Samsung to recall the Note 7 devices. In the second quarter, the semiconductor business raked in 8.03 trillion won in operating profit, which is 204pc from the last year. The Korean company said, “The components businesses drove significant earnings growth… thanks primarily to strong memory demand for high-density DRAMs and SSDs for servers.”
To expand and upgrade its chip plants in the South Korean cities of Hwaseong and Pyeongtaek, the smartphone maker said this month that it will invest 20.4 trillion by 2021.