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Samsung Electronics' Semiconductor Division Achieves Record 89 Trillion Won Operating Profit in Q2

From Hankyoreh · () Korean

Translated from Korean, summarized and contextualized by DistantNews.

At a glance

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  • Samsung Electronics reported a record-high operating profit of 89.2 trillion won for its semiconductor division in the second quarter.
  • The semiconductor business accounted for 99.6% of the company's total operating profit, driven by strong memory chip prices and AI demand.
  • The company's device solutions (DX) division, including smartphones and TVs, incurred an operating loss of 800 billion won.

Samsung Electronics has achieved a record-breaking operating profit of 89.2 trillion won in its semiconductor division for the second quarter of this year, the company announced on July 30th. This remarkable figure represents 99.6% of Samsung's total operating profit for the period, underscoring the dominance of its chip business.

Amidst strong market demand (for memory), we set new quarterly records for both DRAM and NAND flash sales, breaking our previous record from the first quarter.

— Samsung ElectronicsExplaining the record-breaking performance of the semiconductor division.

The surge in profits is attributed to a significant increase in memory chip prices, fueled by robust demand, particularly for artificial intelligence (AI) applications. The company reported that its semiconductor operating profit margin reached an impressive 70%, surpassing that of Taiwan's TSMC. While SK Hynix reported a higher margin of 76%, Samsung's performance highlights its strong market position amidst a global shortage of memory components.

Samsung stated that the strong demand for memory, AI servers, and high-bandwidth memory (HBM) is expected to continue, leading to sustained supply shortages. This positive outlook for the semiconductor division contrasts sharply with the performance of its Device Solutions (DX) division, which encompasses smartphones, TVs, and home appliances. This division reported an operating loss of 800 billion won, primarily due to increased component costs despite strong sales of its Galaxy S-26 and A-series smartphones.

We have renewed our all-time record performance by actively responding to the demand for memory and artificial intelligence (AI) servers.

— Samsung ElectronicsHighlighting the company's strategy in meeting market demand.

Looking ahead, Samsung anticipates continued growth in its overall performance in the second half of the year, driven by the ongoing strength in the semiconductor market. However, the company acknowledges the challenging business environment for its DX division due to rising component costs. To address this, Samsung plans to focus on enhancing business competitiveness and improving its operational structure.

The supply shortage is expected to continue due to the accelerating demand growth for DRAM, enterprise SSD, and high-bandwidth memory (HBM).

— Samsung ElectronicsForecasting future market conditions for memory products.
DistantNews Editorial

Originally published by Hankyoreh in Korean. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

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