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Due to higher-than-expected chip prices and continued consumer demand for electronics during the pandemic, Samsung's operating profit saw strong growth in the second quarter.
The South Korean electronics giant reported operating income of 12.5 trillion won ($10.8 billion) for the quarter ended June 30, up 54% from the same period last year.
Revenue increased 20% to 63.6 trillion won ($55.2 billion).
Revenue and earnings growth for Samsung's fourth consecutive quarter marks the company's full-year recovery. During the same period last year, consumer-focused companies struggled with the coronavirus that swept the world, and revenue fell 7.4%.
The main winner in the second quarter was the semiconductor sector. This is more than half of the company's operating income. And about 35% of sales.
Samsung's semiconductor business grew 25% to 22.74 trillion won ($19.7 billion) and operating income rose 27% to 6.93 trillion won ($6 billion).
Samsung attributed this growth to strong demand for server and computer memory and stronger-than-expected growth in average selling prices for DRAM and NAND chips.
However, Samsung assumes that the spare parts supply problem will continue into the second half of the year. The chip market is expected to continue to experience component supply issues. He may be at risk of contracting the mutated coronavirus and geopolitical tensions.
In addition, the South Korean giant also benefits from multiple sources of income. Including phone and hardware solutions.
Samsung sales increased dramatically
The consumer electronics business is also developing well with sales of 13.4 trillion won, an increase of 20% from the previous year. This is due to increased sales of products such as the recently launched Neo QLED, which uses an improved LED-based backlight system.
The company sells more phones and televisions than any other company. However, he said the cellular division's revenue fell in the second quarter from the previous quarter. The reasons for this are the coronavirus, ongoing supply bottlenecks in the industry and production disruptions.
The wireless division generated sales of 21.4 trillion won (US$18.6 billion) in the first quarter, 24% less than the previous quarter. But it will increase by 8% each year.
Samsung expects the cellular market to return to pre-coronavirus levels in the second half of the year. Supports 5G certification.
One-time revenue helps boost the company's display business. Revenue for the quarter was 6.87 trillion won, up 2%. Although the demand for mobile phone products is low.
Looking at the rest of the year, Samsung said it's cementing its leadership position in premium smartphones. By generalizing collapsible categories. The display department confirmed that the camera technology under the screen is under development.