Advanced Search

Related News

Home » Business

Samsung Q4 profit leaps 50%: firm

Source: AFP | January 24, 2017, Tuesday | Online Edition

SAMSUNG Electronics reported a 50 percent jump in fourth-quarter profits on Tuesday despite the humiliating Galaxy Note 7 recall that hammered the reputation of the world's largest smartphone maker.

The South Korean tech giant took another blow when prosecutors began investigating its involvement in a corruption scandal that has seen the country's president impeached, and sought the arrest of the firm's de facto leader Lee Jae-Yong.

In a statement, the group's flagship subsidiary Samsung Electronics said it posted operating profits of 9.22 trillion won (US$7.9 billion) during the October to December period.

Earnings were "driven by the components businesses, mainly the memory business and the display panel segment", it said, with the stronger US dollar also boosting profits.

Revenues were largely unchanged at 53.3 trillion won for the three months, the South Korean tech giant said.

For the full year, the firm said in a statement, "Samsung achieved solid results despite the Note 7 discontinuation in the second half" -- the only reference to the debacle that saw the company withdraw its much-publicised device.

Operating profits for 2016 reached 29.2 trillion won, up 10.7 percent year-on-year, it said, even though revenues were almost flat at 201.9 trillion won, up 0.6 percent.

Analysts anticipate the trend will continue into 2017.

"We are expecting Samsung to post record-high profits this year on the back of rising chip prices," Greg Roh, an analyst at HMC Investment Securities, told AFP.

Separately, Samsung said in a statement it will buy back 9.3 trillion won worth of its own shares.

- Wrong number -

Samsung was forced to discontinue the Galaxy Note 7, originally intended to compete with Apple's iPhone, in October after a chaotic recall that saw replacement devices also catching fire.

In total 3.1 million smartphones were recalled as authorities in the US and elsewhere banned them from use on planes and even from being placed in checked luggage.

Earlier this week Samsung blamed faulty batteries from two different suppliers for the incidents, which the firm previously estimated would cost it US$5.3 billion.

Samsung has also come up with elaborate step-by-step safety verification procedures for future products to prevent similar disasters, although some analysts remained sceptical.

The findings suggested a lack of attention to product testing and a tendency to rush to market for competitive reasons at the expense of quality control, said Jan Dawson, chief analyst at Jackdaw Research.

"I have confidence that Samsung will make big process changes going forward, but less confidence that the culture that led to these problems will change in the same way," he told AFP.

The firm has separately been caught up in a wide-ranging political corruption scandal, with prosecutors last week seeking the arrest of Lee, vice-chairman of Samsung Electronics, on charges of bribery, embezzlement and perjury.

Lee, who became the group's de facto head after his father suffered a heart attack in 2014, is accused of bribing Choi Soon-Sil, Park's secret confidante at the centre of the scandal, and receiving policy favours from Park in return.

Samsung is the single biggest contributor to two non-profit foundations controlled by Choi, but a court rejected the arrest request due to insufficient evidence.

Business


 

Copyright © 1999- Shanghai Daily. All rights reserved.Preferably viewed with Internet Explorer 8 or newer browsers.

沪公网安备 31010602000204号

Email this to your friend