Opponent Huawei lost, Samsung smartphone segment jumped soaring, profits to the highest in 6 years

Yesterday, South Korean giant Samsung announced its quarterly highest ever business results. The main contributor to this has been due to soaring smartphone sales, gaining more market share from rival Huawei, which is struggling with sanctions from the US government.

However, the South Korean technology company still warns that profits in the next fourth quarter will likely decline due to lower demand for server chips, Covid-19 pandemic, increasing competition in the smartphone market and trade tensions between the US and China.

In the quarter ended September, the company said smartphone sales soared 50%. This is also the quarter that recorded the highest profit from the smartphone segment since 2014, with 4.45 trillion Won (equivalent to 4 billion USD). These positive margins show the success of new flagships such as the Galaxy Note 20 and Galaxy Z Fold2, as well as the strong sales of low-cost devices in India.

However, the company believes that smartphone sales will decline in the next quarter as competition intensifies and marketing costs continue to soar. Even so, the company also expects demand for mobile chips to increase next quarter as Chinese customers ramp up their orders as the US government increases sanctions on fellow Huawei.

” Immediately, Samsung Electronics expects to see a drop in profits in the fourth quarter due to weakening demand for server memory chips and stiff competition in the mobile phone segment, ” the company said in its statement. consumer electronics. By 2021, the company expects global demand to recover but there is still uncertainty as Covid-19 outbreaks are still likely to recur . ”

Samsung said the company has applied for chip exports to Huawei and is awaiting the results. Most recently the company received a license to supply display components for this Chinese company.

Samsung’s chip business profits soared 82% to $ 4.89 billion year-on-year, as sales of mid-range and low-cost smartphones combined with Huawei’s increased stockpiling of chips before the meeting. must additional sanctions from the US government. These two factors have offset weakened demand from server customers.

This quarter also saw record sales from Samsung’s TV and home appliances business, as demand surged as the “at home” trend unfolded around the world. It is noteworthy that the increase in sales of the tablet division and wearables, such as the Galaxy Tab S7, Galaxy Watch3 and Buds Live, are often underrated products from their Apple competitors.

Altogether, the company reported operating profit surging to $ 10.89 billion last quarter – the highest level in two years. This figure also shows a 59% jump in growth compared to the same period last year, and a 52% increase compared to the preceding quarter.

Revenue also increased 8% to $ 59.05 billion, while net profit rose 49% to $ 8.25 billion.

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