The first two quarters of 2023 were catastrophic for Samsung, which posted very poor financial results. If the smartphone business was resilient thanks to high-end models, sales of memory chips (the other core business) were in sharp decline. Indeed, demand for electronic products, and therefore that of chips, is affected by the crisis. But in the third quarter of 2023, Samsung begins to see signs of recovery.
As CNBC reports, in the third quarter, Samsung's operating profit was down 77.6% year-on-year. This, however, was above analysts' estimates, at 2.43 trillion Korean won or the equivalent of around 1.69 billion euros. In addition, compared to previous quarters, we observe a clear improvement. Indeed, Samsung's operating profit in the third quarter was up 262.6% compared to the second quarter.
Smartphones are selling well
Regarding its smartphones, Samsung says demand increased compared to the previous quarter. “New foldable devices, tablets and wearables saw strong sales, supported by stable supply, and the Galaxy S23 series, launched in the first half of 2023 , also maintained solid sales momentum”, indicates the manufacturer.
Samsung also expects this demand to increase at the end of the year. And he also mentions a rebound in the smartphone market in 2024, thanks to improved consumer confidence and a stabilization of the economic situation. In other words, when it comes to the smartphone market, the worst is over.
Furthermore, Samsung's screen business was boosted by the release of new flagship products by its main customers. As a reminder, Samsung is one of the suppliers of screens for the iPhone.
The situation is improving for chips
As for chips, the financial results have been weighed down of Samsung in the first and second quarters, the situation is improving. “The Memory business reduced its losses sequentially as sales of high value-added products and average selling prices increased somewhat”, we can read in the Samsung press release.
Furthermore, for the last quarter of 2024, Samsung estimates that despite uncertainties (including geopolitical factors), Samsung is observing the first signs of an increase in demand. The Korean giant expects an improvement in consumer confidence, a reduction in inflation, but also the launch of new products by PC and smartphone brands that use its memory chips.
- Samsung has just presented its financial results for the third quarter of 2023
- Operating profit was still down compared to 2022, but it was above analysts' forecasts
- Additionally, Samsung sees improvement compared to previous quarters
- Samsung smartphones remain resilient thanks to the premium segment, while the situation is improving for chips
- Samsung anticipates an improvement in the last quarter of 2023 and a rebound in the smartphone market in 2024