Monday, 06 December 2021 03:42 GMT

Samsung reports 28% jump in profit despite supply chain woes


(MENAFN- AFP)

South Korean tech giant Samsung Electronics posted a 28-percent jump in operating profit on Thursday despite global supply chain challenges caused by the pandemic.

The World's top chipmaker saw its operating profit reach 15.8 trillion won ($13.5 billion) for the July-September period, it said in a regulatory filing.

Its sales rose 10 percent on-year to a record 74 trillion won on the back of strong performance from its memory chip division thanks to sustained global demand.

The company said "favourable market conditions continued in the memory market" resulting in "robust sales".

"The Memory Business saw a significant improvement in earnings with record quarterly bit shipment, as well as the second-highest revenue for DRAM (memory chips)," it said in a statement.

Operating profits generated from its semiconductor business accounted for over 60 percent of the total, illustrating a significant role the division plays to the sprawling group.

But the firm acknowledged it would continue to be affected by supply shortages for memory chips, noting "a longer-than-expected component supply issue may need to be monitored".

While the coronavirus pandemic has wreaked havoc on the world economy, it has helped many tech companies boom.

Pandemic-driven working from home has boosted demand for devices powered by Samsung's chips, as well as home appliances such as televisions and washing machines.

Now supply chain problems are hitting economic activity around the world, with companies facing shortages of key commodities, components and shipping capacity.

Weakness in the South Korean won against the US dollar has boosted the chip maker's profit margins, Samsung said, contributing around 800 billion won on its operating profit compared to the second quarter.

Samsung Electronics is the flagship subsidiary of the giant Samsung group, by far the largest of the family-controlled empires known as chaebols that dominate business in South Korea, the world's 12th largest economy.

The conglomerate's overall turnover is equivalent to one-fifth of gross domestic product.

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