Samsung reports 34% jump in Q2 profit, bets on foldables to boost smartphone profits
What you need to know
- Samsung has announced its financial results for the second quarter of 2021.
- The company's operating profit increased 54% YoY, thanks to solid chip sales.
- Samsung's mobile communications division, however, saw a decrease in revenue over the previous quarter.
Samsung Electronics' operating profit jumped 54% YoY and 34% QoQ in the second quarter of 2021, led by strong semiconductor sales. The company posted KRW 63.67 trillion (about $55.5 billion) in revenue and KRW 12.57 trillion (about $10.9 billion) in operating profit.
Samsung's semiconductor division contributed more than a third of the total revenue during the second quarter. The memory business registered a significant increase in sales over the previous quarter due to a stronger-than-expected rise in prices of both DRAM and NAND chips. While demand for server and PC memory was strong, sales of mobile memory were affected by tight supplies of key components and recurring waves of COVID-19 outbreaks at smartphone production bases around the world. The company's display earnings also grew as the overall ASP went up.
Samsung's IT & Mobile Communications division was hit by the global component supply shortage and production disruptions in the company's Vietnam factory. These factors, combined with weak seasonality, resulted in a decrease in revenue compared to the first quarter of the year. However, revenue was still higher compared to the same period a year earlier.
Samsung expects the global smartphone market to recover to the pre-COVID level in the second half of the year. It plans to achieve "solid revenue and profits" in the coming quarters by "mainstreaming" foldables and launching new mass-market 5G phones.
Samsung's next foldable phones will be unveiled at an Unpacked event on August 11. Alongside the Galaxy Z Fold 3 and the Galaxy Z Flip 3, the company is also expected to introduce the follow-up to last year's Galaxy S20 FE at the event. All three phones are tipped to have the same Snapdragon 888 chipset under the hood as the best Android phones on the market.
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