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Samsung Electronics Sees Record-breaking 1Q

Posted May. 01, 2010 07:27,   


In 1995, Korea enjoyed a huge economic boom in surpassing Japan in major industries and exceeding 10,000 U.S. dollars in per capita income. Leading the boom was semiconductors manufactured by Samsung Electronics.

Samsung Electronics’ first-quarter earnings announced Friday reminded many of the boom 15 years ago.

The electronics giant said it earned in the first quarter this year 4.41 trillion won (3.9 billion U.S. dollars) in operating profits, an incredible rise of 643 percent from the same period last year, on sales of 34.64 trillion won (31.2 billion dollars), up 21 percent.

Experts credited the surprise earnings to a surge in the demand for computer memory chips, a key component in personal computers and mobile phones, amid soaring sales of smartphones and personal computers. From its chip-making sector alone, Samsung Electronics raked in 8.2 trillion won (7.4 billion dollars) in sales and 1.96 trillion won (1.7 billion dollars) in operating profits.

The first quarter, which follows the Christmas shopping season, is traditionally a slow season for the electronics industry, but Samsung Electronics showed solid performances in all key areas such as memory chips, LCD panels, televisions and mobile phones.

In particular, Samsung showed its power in the mobile phone business despite fears over fiercer competition due to the surging popularity of Apple’s iPhones. Samsung sold a quarterly high 64.3 million units of mobile phones, backed by strong sales in emerging markets such as India and former Soviet republics.

In the mobile phone market, the company earned 1.1 trillion won (993.6 million dollars) on sales of 9.18 trillion won (8.3 billion dollars).

Samsung also remained the world’s top seller of TV sets. In its digital media division, the company saw its sales surge 18 percent year-on-year to 12.61 trillion won (11.3 billion dollars) in the first quarter, while operating profits jumped 11 percent to 520 billion won (469.7 million dollars).

Its LCD division also earned 490 billion won (442.6 million dollars) in operating profits on quarterly sales of 6.85 trillion won (6.1 billion dollars).

So the question is if Samsung can top its record sales and earnings performances of last year. The domestic securities industry expects the company to exceed 150 trillion won (135.5 billion dollars) in sales and 16 trillion won (14.4 billion dollars) in operating profits this year if the semiconductor boom continues and Samsung’s 3-D TV business is successful.