Samsung: 26 percent more profit by chips and displays

Samsung: 26 percent more profit by chips and displays

The Sudkorean Electronics Group Samsung increased its profit by 26.4 percent to € 6.6 trillion in the fourth quarter, about 4.9 billion euros,. As of Thursday’s quarterly report, sales in the three-month period rose by 2.8 percent year-on-year from October to December 2020 to 61.55 trillion WON.

Samsung continues to benefit from the effects of the corona crisis. So stop the demand for memory chips for servers and PCs. In the displays Samsung placed compared to the third quarter. For the first quarter of the new business year, Samsung predicts a slight increase in profit.

In the year-on-year, Samsung cuts better in sales and profit in the fourth quarter, in contrast to the third quarter, however, sales and profits were back, as shown by Samsung’s quarterly report. Accordingly, sales of 66.69 trillion won down to 61.55 trillions won, the gain went from 9.36 trillion WON to 6.61 trillion Won Back. In the year 2020 Samsung generated more than in 2019. 236.81 trillion WON 2020 are 230.4 trillion WON 2019 opposite. The profit fell 2020 with 26.41 trillion WON noticeably high than 2019 with 21.74 trillion WON out.

Robust semiconductor business and strong display division

The business with semiconductors continues to drive through the Corona pandemic. With 18,18 trillions Won, of which 13.52 trillions Won for memory chips, demand continues to be robust. Compared to the previous year, this means an increase of 8 percent, but it was 3 percent compared to the third quarter. The bottom line is the increase in profit over the year at 4.79 trillion WON. The prices for storage chips have fallen in the fourth quarter, also the cost of establishing new production states was created, it is called by Samsung.

The display division of Samsung has risen in the fourth quarter to now 9.96 trillion WON, an increase of 24 percent compared to the same quarter of the previous year. Of this, 1.75 trillions were remained as a profit. Especially compared to the third quarter, the display division of 0.47 trillions won properly a shovel on it. As Samsung executed, the demand of a coarse customer and the gradual recovery of smartphone demand for this good result ensured.

Weak mobile area

In the mobile sector Samsung had to accept a decline of 11 percent in sales compared to the same quarter of the previous year. 21.46 trillion WON turnover generated Samsung in Q4, in Q3 the turnover was still at 29.81 trillion WON. Samsung leads this to an intensive competition at the end of the year, costs for marketing had also streamed the profit. For the entire year, sales with € 96.02 trillion Won against 2019 with 102.33 trillions Won 6 percent was lower.

In the Consumer Electronics division, Samsung also had to accept a revenue growth of 6 percent compared to the same quarter of the previous year to € 13.61 of trillions, but the division over the entire year increased a sales increase of 6 percent to € 48.1 trillion. Also, the profit was 3.56 trillion WON high than 2019 with 2.51 trillion WON.

Optimistic view

Samsung profited in the past business year 2020 pandemic-conditioned from high demand for memory chips, consumer electronics and displays. In the mobile area, however, it was less good. That’s going to be better in 2021. The Group relies on the mid-January line of the Samsung Galaxy S21. The demand for 5G smartphones in the mass market should increase this year, which Samsung wants to benefit. In order to increase the profitability, Samsung uses to reduce costs and increase efficiency.

Also, the semiconductor production should be expanded. In the conversation, the locations Hwaseong and Pyeongtaek are in Sudkorea and Austin in Texas, in which $ 10 billion could fly. Apparently, Samsung also wants to expand his business as a ready-to-use. So it is speculated that Intel chips could be made from Samsung. In addition, Samsung plans to buy 2023 significant corporate purchases. Which ones are, but is still open. The last gross purchase was 2017 the car supplier Harman for 8 billion US dollars.

But it remains uncertainty through the Corona Pandemic. Therefore, the predictions for the business of Samsung for 2021 are optimistic, but also with a certain accessibility. In the first quarter Samsung says a slight increase in profit, without calling concrete numbers. Also, the detention of Samsung’s de facto-boss Lee Jae-Yong, which was convicted of bribery at a two-half-year prison sentence, does not preclude for stability in the Group.

Samsung’s share price was initially backed by 3.17 percent in the course of the Thursday Morformance after Borsenoffnung, but then pulled on again. A paper is now worth 1380 euros.

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