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Operating profit of KRW 14.87 trillion on sales of KRW 58.48 trillion
Consolidated net profit of 2 KR to 11.04 trillion KR
Expectations 2H improvement in market strength of memory, flexible sales OLED
Samsung Electronics has released financial results for KRW's consolidated quarterly business figure has been established at 58.48 trillion KRW, down 4% from in the previous year and KRW of 14.87 trillion quarterly operating profit, up 6%
. Smoother sales of smartphones and billboards, despite a strong demand for memory chips. The continued strength of the Company's memory operations contributed to the increase in operating income. Net income was little changed from the previous year due to the increase in income tax.
Earnings and operating profit both decreased compared to the previous quarter. The Korean won has weakened against the US dollar, but has risen against the euro and several other key currencies, resulting in a negative impact of 400 billion net KRW on earnings. Quarterly operation compared to the previous quarter
. continued to deliver strong earnings, driven by the demand for DRAM chips used in data centers and NAND flash memory for high-capacity storage, while NAND prices fell. Samsung has consolidated its competitive positioning by focusing on value-added products, including 64GB and high-density DRAMs based on 1X nanometer technology and 128GB and above for NAND mobile storage.
flexible OLED panels in the second quarter while shipping and the price of LCD panels also dropped.
In the stagnant high-end smartphone market, the IT & Mobile Communications division recorded a decline in profits, both year-over-quarter, on slow sales of the Galaxy S9. The network business, however, has seen solid growth thanks to the investments of major global customers in LTE networks.
Higher sales of premium TVs such as the QLED models, aided by a major global football event, have enabled Samsung's Consumer Electronics division to look forward to sustained growth in the memory market and to growing demand for flexible OLED panels to generate higher profits in the second half.
The outlook for the memory chip industry remains strong in all applications due to the demand for server and PC memory as well as new mobile product launches. Samsung will proactively respond to the demand for differentiated products such as high-density server memory and high-bandwidth memory. The company will also strengthen its technological leadership by increasing the share of 10-nanometer products and developing mbad production of 5th generation V-NANDs.
System LSI and Foundry activities will benefit from increased demand for mobile APs and the image. Sensors Flexible OLED deliveries are expected to increase, even as competition intensifies on rigid products.
The mobile phone market is likely to remain difficult in the second half due to price competition and the launch of new products. The company will respond with the early introduction of the Galaxy Note and competitive mid-range and low-end models with new features. The TV business figure will continue to improve with the sales expansion of new high-end innovative models, including QLED and 8K TVs.
In the medium and long term, Samsung is anticipating new opportunities in the component business. the industry, led by the Internet of Things (IoT), artificial intelligence (AI) and 5G technologies. Companies in the sector will also benefit from the introduction of new form factors and innovative technologies to meet the growing demand for connected devices.
Samsung will use its advanced semiconductor technology to capitalize on the new demand for chipsets used in components. automotive applications and IA. The company will also leverage its strength in OLED panels to take advantage of broader applications in the IT and automotive industries.
The company's investment expenditure in the second quarter was KRW 8 trillion, of which KRW 6.1 trillion for semiconductors and KRW 1.1 trillion for Display Business. It brings the total spent in the first half of 2018 to KRW 16.6 trillion.
Semiconductors will experience strong demand in the second half of the year
The semiconductor industry recorded a consolidated turnover of 21.99 trillion KRW and a profit of Operating 11.61 trillion KRW for the quarter. The memory sector performed well despite weak seasonality, as overall demand growth was strong, driven by data center servers.
For NAND, demand remains strong thanks to the trend towards densification of smartphones and the increase in demand. for the SSD server due to the expansion of the cloud infrastructure. Samsung has posted strong results in responding to new mobile device launches and demand for higher density products. The Company is also focused on high value-added, high-density SSDs for servers.
For DRAM, the demand for servers has remained strong due to the shift to density and expansion of data center infrastructure. PC demand remained robust, driven by growing demand from major OEMs, while strong demand for games helped the graphics segment. In the mobile phone market, despite the concern about the slowdown in smartphone growth, the increase in memory content per device has continued.
The adoption of the SSD should extend to more sectors and all product segments should use more high-density eTortage. For servers, the demand for SSD for data centers is expected to remain strong, while for businesses, the adoption of a high-density server SSD of more than 8 TB is expected to continue
In the mobile The demand for high-density storage for new smartphones and end-models is likely to remain robust. Samsung will increase the SSD offering of servers and meet the high density eStorage demand based on NAND 3D 64 layer products and the competitiveness of high density solutions.
Regarding the second half DRAM prospects, strong demand is expected to continue. For servers, growth in demand is expected to continue due to expanding demand from US and Chinese data centers, while high-performance cloud services should also be launched.
In mobile, in addition to new smartphone launches the content is expected to increase in the mid-range models because it begins to support high-specification mobile games, the AI on the device and dual camera functions. In addition, the demand for PC will be driven by sales back to schools, while the graphical demand will be driven by the accumulation of game consoles. Samsung will focus on enhancing product competitiveness by continuously expanding the 10-nanometer technology migration and expanding sales of high value-added products, such as high-density DRAM servers, HBM2 and LPDDR4X
. , the trend towards higher-performance, higher-density servers for data centers is expected to continue due to the expansion of AI-based services based on machine learning and learning. 39, adoption of the database in memory. In the mobile phone sector, growth in demand is expected to continue, as the need for high performance devices increases with the increase in high density content. Samsung will closely monitor the market situation and the supply and demand conditions of each segment in order to maintain sustainable medium- and long-term benefits through industry-leading technology
. for mobile application processors and DDIs, but the demand for image sensors has continued to increase thanks to the increased adoption of dual cameras by Chinese smartphone manufacturers. In the third quarter, expected earnings are expected to increase on a quarterly basis as demand for image sensors and DDIs, due to a strong seasonality of smartphones.
In the second half, overall profits should improve compared to the first half. DDI and high resolution image sensors. In addition, Samsung plans to diversify its customer base for mobile access points from China and develop chips for automotive and IoT applications. In the medium and long term, the Company will focus on the development of 5G chipsets, multiple cameras and billboards, seeking to grow faster than the market.
High demand for High Performance Computing (HPC) chipsets, mobile APs and image sensors. In addition, by obtaining orders for 8-inch specialty products, the Company has established a base for achieving stable earnings in the future. Profits should be strong in the second half thanks to higher demand for mobile access points and image sensors. Samsung will also strengthen its technological leadership by starting mbad production 8 nanometers and 7 nanometer-based test production based on EUV.
The company expects a turnover of more than 10 billion USD in 2018, after sales of USD 9.8 billion in 2017 solid second place in the foundry market.
The display rebounded in the second half thanks to the flexible OLED
The billboard sector posted a consolidated sales figure of KRW 5.67 billion and operating profit of KRW 0.14 trillion for the quarter. the use for rigid products, the demand of major customers for flexible panels remaining slow. The benefit of LCD screens also decreased compared to the previous quarter, as the average price of panels and shipping continued their downward trend.
OLED sales are expected to rebound due to the resumption of demand for flexible screens. Samsung aims to increase its market share by actively responding to customer demand while improving technology and pricing competitiveness. The company will incorporate more value-added features into the panels and strengthen its skills in new applications such as folding screens, seeking new growth drivers.
Samsung expects demand to increase in the second half of the year for high-end televisions used in high-resolution and ultra-large models, in the midst of maximum seasonality. The intensification of competition and the expansion of the industry's capacity will limit the profit improvement, but the Company will continue to focus on profit with high products differentiated range such as Quantum Dot and 8K resolution television panels.
Mobile phone sales grow slowly, networks grow thanks to the expansion of LTE
IT & Mobile Communications Division recorded a consolidated turnover KRW 24 000 billion and operating profit of KRW 2.667 billion. Intensification of competition, smartphone shipments and Samsung's revenue declined QoQ due to sluggish sales of Galaxy S9 and S9 + as well as the gradual removal of older low-end models
. At the same time, the Networks business experienced strong growth in sales, as the main overseas sector partners increased their investments in LTE expansion.
The demand for smartphones and tablets is expected to increase in the second half of the year, while the market is highly seasonal. seen intensifying that new models of smartphones are released. In response, Samsung will seek to expand its sales by introducing a new Galaxy Note earlier than usual, which offers exceptional performance at a reasonable price. In addition, Samsung plans to strengthen price competitiveness and adopt advanced technology in mbad models.
Looking ahead, the company will continue to strengthen the competitiveness of its products by adopting advanced technology and new form factors. leadership in 5G. In addition, based on the ever-evolving Bixby ecosystem that connects smartphones, TVs, refrigerators and other IoT devices, Samsung aims to provide personalized service to customers and to create synergy with other services such as Samsung Pay.
The Company will provide its core partners with 5G network solutions and continue to invest to become the world leader in next-generation network solutions.
Consumer electronics maintains leadership in the high-end market
The Consumer Electronics division, which includes Visual Display and Digital Appliances, posted a revenue increase of $ 1.25 billion. Consolidated business of KRW 10.4 trillion and KRW operating profit of 0.51 trillion in the second quarter. Overall, the television market saw demand grow compared to last year, as a major global football event pushed sales up. Samsung recorded a significant increase in profits in the television sector thanks to strong growth in its high-end products, including QLED and very-widescreen TVs.
Following a successful restructuring of its product line, Samsung For the digital device business, the overall market has declined year-over-year mainly due to emerging market instability, although the developed markets posted market gains of more than 50%. moderate growth. Samsung continued to increase sales of high-end products in the second quarter, including the Family Hub refrigerator and the high-end "CUBE" air purifier. However, profits declined slightly year on year due to weak demand for air conditioners.
If we look to the second half, the television market is expected to grow year on year, especially in developed economies. Samsung will strive to further improve its profitability by focusing on high-end TV sales and maximizing deliveries during the high season of the end of the year. The second half of the launch of the company's first 8LE QLED TV based on artificial intelligence is expected to further consolidate its leading position in the high-end television market
. seasonal promotions in key areas, including Black Friday, and the expansion of sales of high-end products and integrated home appliances.
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