Although Samsung's third-quarter operating profit fell 78% to 2.4 trillion won ($1.78 billion) from 10.85 trillion won ($8.05 billion) a year earlier, the third-quarter operating profit was the highest was this year. . The company spent 11.4 trillion won ($8.45 billion) in capital expenditures and is expected to spend 53.7 trillion won ($39.82 billion) by 2024.
Operating profit for the first quarter of this year was 640 billion won (US$474.6 million), and operating profit for the second quarter was 670 billion won (US$496.9 million). operating profit for the third quarter exceeded the combined profit for the first and second quarters. Third-quarter revenue fell 12% to 67.4 trillion won ($50 billion). In the fourth quarter, Samsung was able to reduce memory chip losses by 14% from 4.36 trillion won to 3.75 trillion won by focusing on advanced AI DRAM chips and reducing production of older chips.
Smartphone and PC makers are facing weak consumer demand and have decided to reduce chip inventories rather than spend to increase their inventories. But Samsung sees a brighter future for memory chips, saying: "Demand for PCs and mobile devices will likely benefit from the emergence of different product replacement cycles." As a sign of this improving trend, chip prices started to rise at the end of the third quarter.
Samsung Galaxy S23 Ultra sold more than 10 million units this year
Samsung's memory chip rival SK Hynix recently said its DRAM chips are taking advantage of the "artificial intelligence boom." A combination of rising demand and earlier production cuts began to prompt customers to place orders as prices stabilized.
In 2024, Samsung expects growth in the smartphone market as consumers begin shopping ahead of the global economic recovery. Premium phones and tablets will see growth. The smartwatch segment will see double-digit growth, while the wireless stereo market is expected to see moderate growth.
Strong demand for premium OLED displays from smartphone makers is expected to continue next year, helping Samsung Display's business grow. Samsung said that by 2024, the mobile panel business plans to meet the growing demand for new applications, while the large panel business will increase profitability by adding new products and increasing production.
The semiconductor unit completed development of the Exynos 2400 this quarter, and the deca-core chip will deliver improved CPU, GPU and NPU performance compared to its predecessor. "The mobile SoC is in the final stages of developing next year's flagship smartphones and is poised to expand its business portfolio by targeting global customers for its modem business while improving on-device AI solutions." Samsung hopes to improve the sector's performance in 2024 by increasing sales of its flagship semiconductors and selling chips to makers outside the mobile phone industry.
Samsung Foundry reported weak earnings in the third quarter as a slowdown in the mobile phone sector delayed an estimated increase in foundry usage. Fourth quarter revenues in this segment will increase as demand increases with the launch of new devices. Samsung is ramping up production of its second-generation 3nm process node, which will help generate more business.
Samsung shares rose 100 won (7.4 cents) a day to 67,200 won ($49.87) on the Korean stock exchange. The 52-week high is 73,600 won ($54.64) and the 52-week low is 54,500 won ($40.46).
Samsung Electronics posted record revenue in the third quarter amid strong demand for memory chips
