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198035
Fri, 07/29/2011 - 10:52
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https://oananews.org//node/198035
The shortlink copeid
Samsung Electronics logs forecast-beating Q2 net on smartphones
(ATTN: UPDATES share price; RECASTS para 8; ADDS smartphone data in para 10-11)
By Lee Youkyung
SEOUL, July 29 (Yonhap) -- Samsung Electronics Co., the world's top memory chipmaker, reported Friday a second-quarter earnings that beat market expectations as strong smartphone sales offset feeble demand for TVs and display panel losses.
But the company warned of the tough quarters ahead as consumers may remain reluctant to spend on TVs and PCs while Samsung's smartphone and tablet PC businesses will face increased competition from rivals.
Net profit reached 3.51 trillion won (US$3.33 billion) in the April-June period, compared with 4.28 trillion won a year earlier, it said in a regulatory filing.
Although the net income marks an 18-percent decline from one year ago, the bottom line was higher than the consensus of 3.35 trillion won estimated by analysts polled by Yonhap Infomax, the financial news arm of Yonhap News Agency.
Sales rose 4 percent on-year to 39.44 trillion won, but operating profit sank 25 percent to 3.75 trillion won, which was in line with the company's guidance announced early this month.
Shares of Samsung Electronics closed at 844,000 won on the Seoul bourse, up 0.84 percent from Thursday's close.
Samsung, the world's largest supplier of liquid crystal display (LCD) panels and TVs as well as the second-biggest mobile phone maker, said that operating profit from the telecommunications division more than doubled from the previous year, limiting the losses from the semiconductor and LCD sectors that are undergoing cyclical downturns.
The robust profit growth was driven by the strong sales of smartphones, such as the Galaxy S2 that topped 5 million unit sales in the three months since its April debut, Samsung said.
"Despite the challenging business environment and global economic uncertainties, we achieved continued year-on-year revenue growth in the second quarter driven by mobile device sales, particularly the success of our smartphones," Robert Yi, head of the company's investor relations, said in a statement.
While Nokia Corp., the world's top mobile phone maker, reported a dismal loss in the second quarter, Samsung nimbly reshaped itself from a smartphone also-ran to one of the world's top two smartphone makers.
Samsung sold 19 million smartphones in the three month period that ended June 30, far above Nokia's 16.7 million, Reuters and Bloomberg reported, citing market research firm Strategy Analytics. The Korean handset maker only trailed behind Apple Inc., which sold 20.3 million iPhones, in the global smartphone market.
The company aims to outsell its 60 million smartphone sales target for this year and play catch-up with Apple in the tablet PC market, its mobile president Shin Jong-kyun said in a recent interview.
In component businesses, however, Samsung joins other global suppliers of memory chips and display panels that have been hit by sluggish demand for consumer electronics.
Samsung's mainstay semiconductor business reported about a 40-percent slump in operating profit from one year earlier, as prices of dynamic random access memory (DRAM), key components in personal computers, plunged to roughly a quarter of year-ago prices.
The LCD division swung to the red from the year-earlier quarter and continued hemorrhaging for a second straight quarter. It joined its smaller rival LG Display Co., which reported a third straight quarterly loss last week.
Many market research firms and industry officials have already downgraded TV sales forecasts for this year, citing uncertain economic growth. Prices of LCD panels are sensitive to demand for TVs, which account for more than half of the Korean LCD makers' revenues.
Samsung will face challenging business conditions going forward, as uncertainties about demand persist in the TV and PC industries. Ballooning sovereign debts in Europe and the political stalemate in the U.S. budget talks cloud economic prospects in the advanced economies, analysts said.
"The problem is the third quarter," said Noh Geun-chang, a Seoul-based analyst at HMC Investment Securities Co. "It won't be easy to increase operating profit."
Although Samsung will likely sell more mobile handsets and more TVs for the rest of the year than during the first six months of 2011, forecasting their price levels, which determine the company's income, is "very difficult" as the heightened economic uncertainties muddle demand prospects, Yi said.
"We are very concerned about third-quarter PC demand," Kim Myung-ho, vice president of Samsung's semiconductor business, said in a conference call. "We are not sure about the market growth."
Hinting that it might join LG Display in belt tightening, Samsung said an investment cut is possible in the LCD panel sector as it may relocate some of the LCD investment budget to semiconductors, it said.
The annual projected capital expenditure of 23 trillion won remains the same, it added.
By Lee Youkyung
SEOUL, July 29 (Yonhap) -- Samsung Electronics Co., the world's top memory chipmaker, reported Friday a second-quarter earnings that beat market expectations as strong smartphone sales offset feeble demand for TVs and display panel losses.
But the company warned of the tough quarters ahead as consumers may remain reluctant to spend on TVs and PCs while Samsung's smartphone and tablet PC businesses will face increased competition from rivals.
Net profit reached 3.51 trillion won (US$3.33 billion) in the April-June period, compared with 4.28 trillion won a year earlier, it said in a regulatory filing.
Although the net income marks an 18-percent decline from one year ago, the bottom line was higher than the consensus of 3.35 trillion won estimated by analysts polled by Yonhap Infomax, the financial news arm of Yonhap News Agency.
Sales rose 4 percent on-year to 39.44 trillion won, but operating profit sank 25 percent to 3.75 trillion won, which was in line with the company's guidance announced early this month.
Shares of Samsung Electronics closed at 844,000 won on the Seoul bourse, up 0.84 percent from Thursday's close.
Samsung, the world's largest supplier of liquid crystal display (LCD) panels and TVs as well as the second-biggest mobile phone maker, said that operating profit from the telecommunications division more than doubled from the previous year, limiting the losses from the semiconductor and LCD sectors that are undergoing cyclical downturns.
The robust profit growth was driven by the strong sales of smartphones, such as the Galaxy S2 that topped 5 million unit sales in the three months since its April debut, Samsung said.
"Despite the challenging business environment and global economic uncertainties, we achieved continued year-on-year revenue growth in the second quarter driven by mobile device sales, particularly the success of our smartphones," Robert Yi, head of the company's investor relations, said in a statement.
While Nokia Corp., the world's top mobile phone maker, reported a dismal loss in the second quarter, Samsung nimbly reshaped itself from a smartphone also-ran to one of the world's top two smartphone makers.
Samsung sold 19 million smartphones in the three month period that ended June 30, far above Nokia's 16.7 million, Reuters and Bloomberg reported, citing market research firm Strategy Analytics. The Korean handset maker only trailed behind Apple Inc., which sold 20.3 million iPhones, in the global smartphone market.
The company aims to outsell its 60 million smartphone sales target for this year and play catch-up with Apple in the tablet PC market, its mobile president Shin Jong-kyun said in a recent interview.
In component businesses, however, Samsung joins other global suppliers of memory chips and display panels that have been hit by sluggish demand for consumer electronics.
Samsung's mainstay semiconductor business reported about a 40-percent slump in operating profit from one year earlier, as prices of dynamic random access memory (DRAM), key components in personal computers, plunged to roughly a quarter of year-ago prices.
The LCD division swung to the red from the year-earlier quarter and continued hemorrhaging for a second straight quarter. It joined its smaller rival LG Display Co., which reported a third straight quarterly loss last week.
Many market research firms and industry officials have already downgraded TV sales forecasts for this year, citing uncertain economic growth. Prices of LCD panels are sensitive to demand for TVs, which account for more than half of the Korean LCD makers' revenues.
Samsung will face challenging business conditions going forward, as uncertainties about demand persist in the TV and PC industries. Ballooning sovereign debts in Europe and the political stalemate in the U.S. budget talks cloud economic prospects in the advanced economies, analysts said.
"The problem is the third quarter," said Noh Geun-chang, a Seoul-based analyst at HMC Investment Securities Co. "It won't be easy to increase operating profit."
Although Samsung will likely sell more mobile handsets and more TVs for the rest of the year than during the first six months of 2011, forecasting their price levels, which determine the company's income, is "very difficult" as the heightened economic uncertainties muddle demand prospects, Yi said.
"We are very concerned about third-quarter PC demand," Kim Myung-ho, vice president of Samsung's semiconductor business, said in a conference call. "We are not sure about the market growth."
Hinting that it might join LG Display in belt tightening, Samsung said an investment cut is possible in the LCD panel sector as it may relocate some of the LCD investment budget to semiconductors, it said.
The annual projected capital expenditure of 23 trillion won remains the same, it added.
