After a year that saw its de facto head arrested, one of its flagship devices literally explode, and its public reputation plunge, Samsung Electronics Ltd. appears to have made a full recovery.
In its most recent quarterly results, the South Korean electronics giant posted a net operating profit of 11.05 trillion won (approximately $12.3 billion CAD), while parent company Samsung Group posted total revenues of 50.9 trillion won (approximately $56.7 billion CAD), a year-over-year increase of 4.9 per cent.
The company’s gross profit margin improved too, by 1.6 per cent.
“Samsung Electronics has been focused on staying on the top of technological and product competitiveness to respond to rapid changes in the IT industry, in order to lead the development of the new technologies and establish a foundation for stable growth in the future,” the company’s senior vice president of investor relations, Robert Yi, said during a July 27 Q2 earnings call. “2016 is a very meaningful year for the company as we are seeing these efforts come into fruition.”
The company’s revenue increase was largely driven by two things: strong mobile device sales, and sales of OLED panels for mobile applications, Yi said.
According to KyeongTae Lee, vice president of Samsung’s Mobile Communications division, the company’s most popular devices were the Galaxy S7 and S7 Edge (which, as always, we feel compelled to remind readers and ourselves is not prone to exploding), with the S7 Edge representing more than 50 per cent of devices sold.
Lee also referred to what he called the company’s “new large-screen flagship,” which he said “will also meet our customers’ expectation just as the Galaxy S7 received positive response from the market by reflecting the voice of our customer,” though he acknowledged that its success would likely be “somewhat impacted by intensifying competition in the market.” Further details were not given.
Samsung expects its strong performance to continue into the second half of 2017, with increased component earnings offsetting a likely slowdown in device sales.
As senior vice president of investor relations Yi noted, the third quarter is a traditionally low season anyway.
Our thanks to investment research platform Seeking Alpha for the transcriptions from Samsung’s July 27 Q2 earnings call.
