Samsung Electronics Reports Revenue of KRW 30.27 trillion,Operating Profit of KRW 1.48 trillion
SEOUL, Korea . October 24, 2008 : Samsung Electronics Co. Ltd today announced third quarter revenue of 30.27 trillion won on a consolidated basis for the period ended September 30, 2008, an increase of 4% compared to the second quarter.
Operating profit for the quarter was 1.48 trillion won, a 38% decline from 2.4 trillion won in the second quarter.
Despite challenging conditions overall, the company reported favorable or better-than expected results in key business sectors including semiconductor, which maintained profitability despite steep price declines in major chip categories, and telecommunications, where Samsung achieved record quarterly sales in handsets.
The Semiconductor Business Unit continued its strength in the current volatile market environment where demand for memory chips has been declining. Despite sharp drops in prices for DRAM and NAND, the Semiconductor Business reported continued profitability, making Samsung the only major player in the memory industry worldwide that remains profitable in a significant industry downturn.
The Semiconductor Business Unit outpaced all industry peers in the third quarter, posting revenues of 5.29 trillion won on a consolidated basis. Operating profit reached 190 billion won, a 37% decline from the second quarter. A sharp drop in prices of DRAM and NAND contributed to a drop in profits.
That drop in DRAM and NAND prices was mitigated by Samsungs differentiated cost competitiveness and focus on high-end value products including MCP (multi-chip package) and moviNAND. At the same time, System LSI continued to demonstrate strong growth momentum in the market due to steady growth of DDI, Smart Card IC
Revenue on a consolidated basis for the LCD Business Unit dropped 5% in the third quarter to 3.75 trillion won compared to the previous quarter. Operating profit on a consolidated basis declined 57% to 450 trillion won during the same period.
Weak demand and lower prices were the key factors leading to the decline in sales and profits. At the same time, large-sized displays continued to gain strength and are expected to contribute more significantly to robust LCD revenues in the fourth quarter and beyond.
The Telecommunication Network Business Unit posted 8.87 trillion won in revenue, and an operating profit of 840 billion won on a consolidated basis. Operating margins stood at 9.5%. Profitability was slightly affected by the integration of the computer business into the Telecommunication Network Business.
Samsung sold 51.8 million units in the third quarter, or 13% increase from the previous quarter, and a new quarterly record.
The Digital Media Business posted an operating loss of 50 billion won on revenue of 10.77 trillion won on a consolidated basis. Severe price competition, cost increases, and sluggish demand contributed to the loss.
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* The consolidated sales figures are net sales (They exclude interdivisional sales)
--> Including intervision sales, consolidated sales for 3Q 08 : Semiconductor - 5.95 trillion won, LCD - 5.58 trillion won
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* The consolidated OP is provided to enhance the understanding of the investors
Samsung Electronics Co., Ltd. is a global leader in semiconductor, telecommunication, digital media and digital convergence technologies with 2010 consolidated sales of US$135.8 billion. Employing approximately 190,500 people in 206 offices across 68 countries, the company operates two separate organizations to coordinate its nine independent business units: Digital Media & Communications, comprising Visual Display, Mobile Communications, Telecommunication Systems, Digital Appliances, IT Solutions, and Digital Imaging; and Device Solutions, consisting of Memory, System LSI and LCD. Recognized for its industry-leading performance across a range of economic, environmental and social criteria, Samsung Electronics was named the world’s most sustainable technology company in the 2011 Dow Jones Sustainability Index. For more information, please visit www.samsung.com.