Strong Sales of Galaxy Note10 and Fold... Samsung Phones Expected to Achieve 2 Trillion KRW Operating Profit in Q4

[Image source=Yonhap News]

[Asia Economy Reporter Koo Chae-eun] Samsung Electronics' IM division, responsible for the smartphone business, is expected to have recorded operating profit in the low 2 trillion won range for the fourth quarter.

This is a decrease compared to the previous quarter (2.92 trillion won), but an increase of more than 500 billion won compared to the same period last year (1.51 trillion won). Although the total smartphone shipment volume slightly declined, strong sales of the Galaxy Note10 and Galaxy Fold appear to have contributed to the favorable fourth-quarter performance.

On the 8th, Samsung Electronics announced that its consolidated sales for the fourth quarter of last year were 59 trillion won, with operating profit of 7.1 trillion won. Sales decreased by 0.46% compared to the same period last year, and operating profit decreased by 34.26%. The provisional figures for last year's annual sales and operating profit were 229.52 trillion won and 27.71 trillion won, respectively. Sales increased by 5.85% and operating profit by 52.95% compared to the previous year. A Samsung Electronics official explained, "The Galaxy Note10 and Galaxy Fold showed strong performance throughout the fourth quarter, which seems to have positively impacted operating profit."

The IT & Mobile (IM) division, responsible for the smartphone business, is estimated to have recorded operating profit in the low 2 trillion won range in the fourth quarter. Securities firms have issued forecasts ranging from 2.1 trillion to 2.3 trillion won.

In the third quarter of last year, Samsung Electronics recovered smartphone business operating profit to the 2 trillion won level through a successful expansion strategy of the high-margin flagship Galaxy Note10 and the mid-range Galaxy A series. The market views that this momentum continued into the fourth quarter, serving as a foundation for improved profitability. Kiwoom Securities analyst Park Yoo-ak said, "Although total smartphone sales were weaker than expected, the strong sales of the Galaxy Fold and improved profitability due to lower component costs are promising." Mirae Asset Daewoo analyst Park Won-jae predicted, "If the network business operating profit estimate of 230 billion won is included in the IM division, operating profit could increase to the high 2 trillion won range."

This content was produced with the assistance of AI translation services.