After the biggest quarterly
earnings report for the last two years, Samsung Electronics seemed can’t get
enough with the scheduled release of its Samsung Gear S3 smartwatch and Galaxy
Note7.
Recently, the South Korean multinational electronics company reported revenue
growth of 5 percent to 50.94 trillion won. The operating profits of the company
increased by 18 percent to 18.4 trillion won.
Samsung gained on the strong
revenue brought by the mobile division led by the upbeat sales of smartphones.
The segment’s operating margin rose by 16.2 percent on an annual basis with a
solid 570 basis points. Adding to this, the Edge version of the S7 had a warm acceptance in
the market, stressing the friendly market price.
Clearly , the struggle of Apple
to accumulate more profit on its iPhones was an advantage to Samsung. Aside from the fact that Samsung
offers lower price than Apple, the specs of its latest units went head to head
with iPhones.
For the third quarter, the Korean
company forecasted an increase of its ASPs as the market is looking forward to
the launch of its phablet Note device next month and its latest gadgets in the
coming months.
Further, the revenue of the semi
conductor sector of Samsung increased 6
percent to 12 trillion won on an annual basis. The said segment of the company
experienced a headwind as the demand fro value-added memory products rallied alongside
with the higher non-memory sales.
Samsung found support on its
superior manufacturing capabilities despite the expected slump of PC and
smartphone shipments soon. The company has placed its attention on the improvement
of the V-NAND SSD and high-density mobile/server DRAM and has started
maximizing its potential to practice 20-nm node technology.
Greg Roh, an analyst at HMC
Investment shared ‘It will be harder for Samsung in the third quarter because
of the stronger won and an increase in marketing costs. The key point will be
whether components ‒ like semiconductors ‒ will be able to make up for the loss
in profits from finished products.
The revenue for the non-memory
semiconductor business advanced 27 percent to 3.57 trillion won on an annual
basis, an evidence of the firm demand for high-megapixel sensors and the 14-nm processors nowadays.
On the other hand, Samsung’s display
unit lost 3 percent as the LCD business struggle to attain growth due to the
demand for small size OLED panels. As
the LCD price falls, the operating margins drastically dropped 2 percent to 600
bps on an annual basis
.
Meanwhile, Samsung noted the
strong sales of its television and component sales in the second quarter. ‘Looking
ahead to the second half of 2016, the company expects its solid performance to
continue mainly driven by earnings increase in the component business due to
sales growth in high value-added products.’
Samsung is expected to launch its
Gear S3 smartwatch in September. Tech experts predicted the specs of the new
smart watch is not far from the previous Gear S2, thus, it will be run using
Tizen OS with an ability to directly connect to the Internet without the intercession
of a smart phone.
Moreover, the company was
reported of filing a trademark called Samsung Cloud Together to be incorporated
with the Galaxy Note 7 smartphone. The newest smartphone of the company is ecpected
to have Gorilla Glass 5 protection with a USB-C to microUSB adapter.
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