Samsung Electronics has announced net profits of 4.28 trillion won (US$3.61 billion) on consolidated revenues of 37.89 trillion won for the second quarter. Operating profits for the quarter were 5.01 trillion won, topping the previous high of 4.41 trillion won in the first quarter of 2010.
In its earnings guidance disclosed on July 7, Samsung estimated second-quarter consolidated revenues would reach approximately 37 trillion won with operating profits of 4.8-5.2 trillion won.
"In the second quarter, our component businesses performed very strongly, yet it was a more challenging quarter for our set businesses," said Robert Yi, VP and head of Samsung's Investor Relations Team. "With intensified competition throughout the digital media and mobile industries going forward, it may become a challenge to maintain current profitability levels."
Samsung revealed its chip business generated operating profits of 2.94 trillion won on sales of 9.53 trillion won in the second quarter. The profit result was up 765% on the 340 billion won posted a year ago, reflecting the market recovery.
Samsung noted its memory division continued to drive growth. Memory chips accounted for 6.71 trillion won of the company's total chip sales, growing 74% on year. The vendor also claimed its enhanced profitability was supported by accelerating the migration to 40nm-class process technology in the DRAM market and expanding 30nm-class process in NAND.
Samsung's LCD business generated operating profits of 880 billion won on revenues of 7.76 trillion won in the second quarter. The segment's operating margin reached 11.3% in the quarter, compared to 4.2% in the same quarter of 2009.
Sales of Samsung's LCD panels increased 15-20% on year in the second quarter, according to the company. The vendor noted it is focused on increasing sales of premium LCD panels for LED and 3D TVs, as well as enhancing its manufacturing line efficiency to improve profit margins.
Shipments of Samsung's flat panel TVs grew 43% on year to 9.02 million in the second quarter, buoyed by strong growth in developing markets, according to the company. In 3D TVs, Samsung sold more than 500,000 units following the launch of its new lineup in March.
In its telecom business, Samsung sold 63.8 million handsets during the second quarter, up 22% on year. However, increased market competition caused a slight decline in ASP.
Samsung is looking to grow its share of the growing smartphone market in the third quarter. The vendor said its Android-powered Galaxy S has been selected by more than 100 carriers around the world, including four major service providers in the US.
In addition, Samsung said its total capex for the first half of 2010 reached 9.2 trillion won, representing 51% of the 18.2 trillion won planned for the whole year.