South Korean technology giant Samsung has reported better-than-expected net profit for the third quarter of this year, despite a sharp decline in earnings from its core semiconductor business.
The company announced that its net profit for the quarter was 7.78 trillion won ($6.6 billion), up from 6.29 trillion won in the same period last year. This beat analyst expectations of around 7.2 trillion won. However, the company’s operating profit fell by 56% to 7.78 trillion won, compared to 17.57 trillion won in the previous quarter.
Samsung attributed the decline in operating profit to a sharp drop in earnings from its semiconductor business, which has been hit by a global oversupply of memory chips and weak demand for smartphones. The company’s semiconductor division reported an operating profit of 3.05 trillion won for the quarter, down from 7.76 trillion won in the previous quarter.
Despite the challenges facing its semiconductor business, Samsung’s other divisions performed well in the third quarter. The company’s mobile division reported an operating profit of 2.92 trillion won, up from 2.67 trillion won in the previous quarter, thanks to strong sales of its flagship Galaxy S10 and Note 10 smartphones.
Samsung’s display and consumer electronics divisions also posted strong results, with operating profits of 1.65 trillion won and 560 billion won respectively.
Looking ahead, Samsung expects its semiconductor business to recover in the coming months, as demand for memory chips is expected to pick up in the second half of next year. The company is also betting on the success of its upcoming foldable smartphone, the Galaxy Fold, to boost its mobile division’s earnings.
Overall, Samsung remains optimistic about its prospects for the future, despite the challenges facing its semiconductor business. The company’s diverse product portfolio and strong brand recognition continue to drive its success in the highly competitive technology market.
