Samsung Electronics‘ operating profit rose 53.3% in the fourth quarter of 2021 driven by record annual sales, the company said in a regulatory filing on Thursday.
The South Korean company achieved “record sales despite continuing uncertainty based on competitive products”, the tech giant said in a statement, citing solid demand for its premium smartphone lines.
Samsung said its memory chip business this year “expects server demand to grow, attributed to increase in IT investments and new high-core CPUs”, while mobile chip demand is likely to increase due to expansions of 5G-capable models.
For non-memory chips, Samsung expected supply to remain tight due to rising penetration of 5G, solid high performance computing demand, growing out-sourcing and continued inventory demand, it said in a statement.
On Wednesday, Samsung said its semiconductor manufacturing facilities in Xi’an, China, returned to normal operations after a Covid-19 related lockdown affected production.
Chip Profits Doubled
The world’s largest memory chip and smartphone maker posted operating profit of 13.9 trillion won ($11.6 billion). Profits at its chip business, its largest division, more than doubled from the same quarter a year ago to 8.84 trillion won.
Net profit rose 64% to 10.8 trillion won while revenue rose 24% to a record 76.6 trillion won.
Analysts said the profits were lower than the market had expected due to conservative shipments of memory chips, research and development costs and one-off year-end bonuses.
“While Samsung did not disclose its fiscal 2022 capital investment plan, it continues to present a direction of sustaining aggressive investments from the standpoint of longer-term growth and retaining technology advantages,” Masahiro Nakanomyo, equity analyst at Jefferies in Tokyo, said.
The company said its display panel business saw earnings improve for mobile panels but losses in large panels widened due to price declines and costs.
Samsung shares fell 0.6% in early trade on Thursday, compared with the wider market’s 0.4% fall. The company said on Wednesday it would unveil its latest flagship smartphone model on February 9.
- AFP and Reuters, with additional editing by George Russell
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