Via Product Lineup Diversification
Samsung Electro-Mechanics is accelerating its market leadership by focusing on camera modules, chip components, and substrates.
According to the financial investment industry on July 1, Samsung Electro-Mechanics recorded sales of 1.709 trillion won (US$1.53 billion) and operating profit of 70.7 billion won (US$63 million) in the second quarter of this year. These are increases of 5.8 percent and 356.6 percent from the same period last year. This is credited to an increase in the supply of camera modules, main substrate for smartphones and high-end multi-layer ceramic capacitors (MLCC), and the sale of dual cameras in China, as Samsung Electronics' Galaxy S8 has been rolled out in earnest.
This year's earnings are also expected to soar year on year. Three securities firms projected Samsung Electro-Mechanics’s sales at 6.9 trillion won (US$6.2 billion) and operating profit at 312.6 billion won (US$281 million). These are increases of 14.71% and 1181.24% respectively from the previous year.
Samsung Electro-Mechanics is planning to set up a strategy for each core business divisions such as camera modules, chip components, and substrates and to exceed market expectations. The company will expand dual camera modules from flagship models to entry-level models based on a prospect for the expansion of major smartphone companies’ employment.
Samsung Electro-Mechanics is taking the lead in the dual camera market by securing the cost competitiveness of core components and developing optimal solutions such as image fusion and zoom functions. The business structure of camera modules for electric and electronic devices is being diversified into sensors, rear view mirror replacements and modules for driver monitoring systems from rear cameras.
Chip components are also a promising field. Demand for MLCCs is expected to climb due to an increase in the flagship model of Chinese corporate customers and a spike in the use of passive components sparked off by the adoption of organic light emitting diodes (OLED) for flagship models by companies in North America. Samsung Electro-Mechanics is responding to growing demand by ramping up its overseas production capacity.
The company is also employing a strategy to boost its profitability by increasing sales of high value-added MLCCs. The expansion of their product lineups of industrial and electronic products such as products with ultra-high capacities and bending strength improvement products will empower Samsung Electro-Mechanics to make a foray into the Chinese and European markets. In addition, the company is planning to plans to increase its portion of MLCC business for industrial use and electric and electronic devices by building a dedicated line in Busan and strengthening responses to customers.
Samsung Electro-Mechanics completed a production line for RF-PCBs for OLEDs in Vietnam in the first half of this year. Its second-half target is making a turnaround in the HDI business.