Samsung Electronics recorded its highest quarterly sales in the third quarter of 2024, but its semiconductor operating profit was cut in half compared to the previous month, which was not a smile. In particular, the poor performance, which fell behind its competitors who recorded their highest operating profit ever, increased the market's disappointment.

Samsung Electronics announced its business performance for the third quarter of 2024 on the 31st.

Based on consolidated financial statements, sales were KRW 79.987 trillion, up 17.3% year-on-year, operating profit was KRW 9.1834 trillion, up 277.4% year-on-year, and net income was KRW 10.1009 trillion, up 72.8% year-on-year.

Sales for the quarter were up 7% year-over-year, marking the highest quarterly sales ever.

MX improved 13% quarter-on-quarter due to the launch of new smartphone models, while the DS division rose 3% quarter-on-quarter due to increased sales of high-end memory.

Gross profit was 30 trillion won, a slight increase from the previous quarter due to increased sales centered on MX's flagship product.

The DS (Device Solutions) division recorded sales of KRW 29.27 trillion and operating profit of KRW 3.86 trillion. This means that sales increased by 2.5% compared to the previous quarter, while operating profit decreased by 40.2%.

In particular, compared to SK Hynix, a memory semiconductor competitor, which recorded sales of KRW 17.5731 trillion and operating profit of KRW 7.3 trillion (operating profit margin of 40%) in the third quarter of 2024, the company is evaluated to have achieved poor performance with operating profit at half the level.

The industry is evaluating it as a disappointing performance, as while the semiconductor market itself is not bad if competitors' operating profits are the highest ever, only Samsung Electronics' operating profits have decreased by nearly half compared to the previous quarter.

In response, Samsung Electronics plans to improve its business portfolio with a focus on profitability and turn around its sluggish performance.

First, for DRAM, we plan to continue to expand HBM sales and actively respond to the demand for high-capacity servers based on 32Gb (gigabit) DDR5 by accelerating the transition to 1b nano for server DDR5.

For NAND, we plan to further expand sales of 8th generation V-NAND-based PCIe (Peripheral Component Interconnect express) 5.0 and strengthen market leadership through mass production and sales of high-capacity QLC (Quad Level Cell).

The foundry plans to focus on improving performance by expanding various applications and securing customers by securing mass production of 2nm GAA.

The DX (Device eXperience) division recorded sales of KRW 44.99 trillion and operating profit of KRW 3.37 trillion.

MX (Mobile eXperience) achieved growth in sales and operating profit compared to the previous quarter due to the launch of new smartphones, tablets, and wearable products. As specifications improved to enhance product competitiveness, material costs increased, but sales expanded through sales centered on flagship products, securing a profit margin close to double digits.

SDC recorded sales of 8 trillion won and operating profit of 1.51 trillion won.

For displays, performance improved in the case of small and medium-sized businesses due to the launch of new smartphone products by major customers. For large-sized businesses, sales increased compared to the previous quarter based on solid demand for TVs and monitors, but operating profit decreased slightly.