Three weeks ago, Samsung published its earnings guidance for Q3 2021 with some staggering numbers. The company was expecting its highest-ever quarterly revenue. It has now announced the final numbers for the past quarter and, tell you what, the Korean behemoth has indeed made truckloads of money.
Samsung made a record KRW 73.98 trillion (approx. $63.2 billion) in revenue during Q3 2021. The figure marks a healthy ten percent year-on-year (YoY) increase from a year earlier when it made a then-record KRW 66.96 in revenue.
The South Korean firm also made a whopping KRW 15.82 trillion (approx. $13.5 billion) in operating profit this past quarter. It’s the second-highest quarterly profit in the company’s history and the highest in the past three years. Samsung made its highest-ever quarterly profit of KRW 17.5 trillion in Q3 2018.
Robust sales of chips, foldables, and displays boosted Samsung’s profit in Q3 2021
Samsung is attributing the healthy Q3 2021 financial results to robust sales of semiconductor chips, foldable smartphones, and OLED displays. The need for data centers and servers has gone up in the pandemic era due to the new, work-from-home norm. As such, there’s an increased demand for memory and storage chips. Samsung, which is the world’s biggest memory chip manufacturer, has benefitted from this increased demand.
According to the company, the memory chip business saw a record quarterly shipment and the second-highest revenue for DRAM. This helped its semiconductor business to post a strong KRW 26.41 trillion (approx. $22.5 billion) in revenue and KRW 10.06 trillion (approx. $8.6 billion) in operating profit during the period between July and September 2021.
Display business also posted KRW 8.86 trillion (approx. $7.56 billion) in revenue and KRW 1.49 trillion (approx. $1.27 billion) in operating profit thanks to strong sales of mobile displays. Meanwhile, in the mobile division, Samsung’s bet on foldable devices did pay off. The Galaxy Z Fold 3 and Galaxy Z Flip 3 foldables have sold impressively well all around the world. This helped the business rake in KRW 3.36 trillion (approx. $2.27 billion) in operating profit in Q3 2021, with overall revenue coming in at KRW 28.42 trillion (approx. $24.27 billion).
Samsung’s consumer electronics division didn’t have a very good third quarter though. A rise in material and logistics costs means the business only posted KRW 0.76 trillion (approx. $649 million) in operating profit, despite revenue coming in at KRW 14.10 trillion (approx. $12.04 billion).
Going forward, Samsung expects earnings to continue to increase in most areas. Smartphone SoCs and related products will drive the semiconductor division forward. The display division, meanwhile, is hoping to cash in on new smartphone and laptop launches. The company is also expecting strong sales of the Galaxy Z Flip 3 Bespoke Edition. The ongoing semiconductor chip shortage may cause some problems. But Samsung is still expecting a strong financial performance in the last three months of the year.