Samsung Electronics' Q3 profit soars to new record

In the mobile sector, more than four million Samsung Galaxy Note8 smartphones have been sold since their launch in mid-September, contributing to a jump in mobile profit to 3.3 trillion won (S$4 billion).
In the mobile sector, more than four million Samsung Galaxy Note8 smartphones have been sold since their launch in mid-September, contributing to a jump in mobile profit to 3.3 trillion won (S$4 billion).PHOTO: AGENCE FRANCE-PRESSE

SEOUL • Samsung Electronics said it will pay dividends of about 29 trillion won (S$35.3 billion) in the 2018 to 2020 period as it reported record operating profit for the three months to September, lifted by its largest memory chip earnings.

The world's biggest maker of memory chips, smartphones and television sets said the memory chip "super-cycle" of tight supply and strong demand was set to continue as servers and mobile devices require ever-greater processing capacity.

"For 2018, the company expects earnings to grow primarily from the component businesses, as conditions in the memory market are likely to remain favourable and the company expects increased sales of flexible Oled panels," the South Korean tech giant said in a statement.

Samsung is on track for a record full-year profit, with analysts forecasting an even better fourth-quarter on the back of strong memory chip prices and organic light-emitting diode (Oled) screen sales for Apple's iPhone X.

It also announced a shareholder return policy for the next three years, ramping up returns guidance to a level higher than its current range of 30 per cent to 50 per cent of free cash flow to 50 per cent over three years.

Operating profit nearly tripled in the third quarter from the same period a year earlier to 14.5 trillion won, Samsung said in a regulatory filing, matching its earlier estimate.

Revenue jumped 29.8 per cent to 62 trillion won, also in line with its earlier estimate.

The chip business was Samsung's top earner as it booked a record 10 trillion won operating profit, up from 3.4 trillion won in the previous corresponding period.

Client demand for more powerful devices and supply constraints pushed up prices of both DRAM and Nand memory chips, widening profit margins.

In the mobile sector, Samsung has put last year's costly withdrawal of the fire-prone Note7 gadget behind it and posted a jump in mobile profit to 3.3 trillion won from 100 billion won last year.

More than four million Galaxy Note8 smartphones have been sold since the premium model was launched in mid-September, making up for slowing sales of the Galaxy S8 launched earlier this year, analysts said.

REUTERS

A version of this article appeared in the print edition of The Straits Times on November 01, 2017, with the headline 'Samsung Electronics' Q3 profit soars to new record'. Print Edition | Subscribe