Increasing Profits
Samsung Electronics announced on January 24 that it posted a fourth quarter operating profit of 9.22 trillion won (US$7.9 billion), up 50.11 percent from a year earlier. Its consolidated sales increased 0.93 percent to 53.33 trillion won (US$45.72 billion) over the same period, while its net profit rose a whopping 119.89 percent to 7.09 trillion won (US$6.8 billion).
The fourth quarter earnings went up by about 3 trillion won (US$2.57 billion) from the same period a year ago, driven by the components businesses, which make memory chips and display panels. The business showings of the components businesses dramatically improved year on year due to the rising sales of high value-added products, including server SSD, expansion of advanced semiconductor process, increase in selling price of LCD panels and improvement of OLED panel productivity.
For set business, the IT & Mobile Communications (IM) Division saw its profit increase compared to the same period in the previous year because of high sales figures of the Galaxy S7 and better profitability of low-end products through lineup efficiency.
However, the business showings of the Consumer Electronics (CE) Division dropped year on year owing to new investment in B2B business and lower profitability caused by a rise in panel prices, although sales of premium televisions increased
A weaker won against the dollar had a positive impact on its operating profits worth 300 billion won (US$257.18 million), mainly the components business, in the fourth quarter.
Last year, Samsung Electronics recorded an operating profit of 29.24 trillion won (US25.07 billion) and sales of 201.87 trillion won (US$173.06 billion) in 2016 as the company focused on high value-added products over the last two to three years and strengthened the competitiveness of the components business through a strategic investment.