Samsung Electronics announced on July 30 that it has recorded 48.54 trillion won (US$41.47 billion) in sales and 6.9 trillion won (US$5.9 billion) in operating profits in the second quarter of 2015.
Sales have increased by nearly 3 percent, from 47.12 trillion won (US$40.26 billion) in the previous quarter, while operating profits were up 15 percent from 5.98 trillion won (US$5.11 billion) in the prior quarter. According to the company, economic conditions were unstable in the second quarter due to the weak euro and the weak currency of emerging countries, but its sales and operating profits increased from the previous quarter thanks to the sales improvements in the semiconductor sector and the consumer electronics (CE) division.
For the semiconductor business in the second quarter, Samsung Electronics said that its performance improved due to the rising demand for memory products, based on mobile and server, the increasing supply of 14-nanometer mobile application processors, and the steady demand for high value-added LSI products. For the IT & Mobile Communication (IM) sector, the improvement of performance was limited due to the falloff in sales of low-end smartphones and the increased marketing costs for new products, even with the launch of the Galaxy S6. Its performance in the CE division improved from the preceding quarter as the company expanded the sales of premium products with the release of new products, including SUHD TVs, and the sales of main products such as refrigerators, washing machines and air conditioners, improved.
Samsung Electronics predicted that the classic pattern in the IT industry of low growth in the first half of the year and high growth in the second half will be weakened, and the business conditions will be worsened in the second half of this year.
The company also expected to see a performance improvement through actively responding to the growing demand for TVs in the CE sector and start speeding up its 10 nm-level foundry business in the System LSI business. It also said that the memory and display business will see good performance in the second half of the year, but there will be risk factors as well, including the increase in supply of LCD panels and premium DRAM in the industry. For the IM business, the company will continuously expand sales and improve profitability and cost efficiency by launching new high-end and low-end products.
Samsung Electronics will invest a total of 5.9 trillion won (US$5.04 billion) in facilities in the second quarter, including 3.2 trillion won (US$2.73 billion) in the semiconductor sector and 1.1 trillion won (US$939.85 million) in the display sector. The cumulative cost of investment in equipment in the first half amounted to 13.2 trillion won (US$11.28 billion), up 30 percent from 10.3 trillion won (US$8.8 billion) a year earlier.