Despite the crisis of the Galaxy Note, Samsung boosts its profits – The Echoes

In September, some analysts had not hesitated to predict a catastrophic year for Samsung Electronics. The discovery, by the end of August, of battery blazes in a few tens of Galaxy Note 7 was going to ruin the reputation and sales of the giant south Korean. From July to September, its sales of mobile phones have increased by 2 %, quarter-over-quarter. According to the firm Bernstein Research, the group would have sold… 78 million smartphones in the last three months.

If the group does not disseminate to the public that at the end of October detailed information on its latest results, it has already revealed on Friday that it expected to generate on the third quarter, a surge of 5.5% of its operating profit, to 7.800 billion won (6.3 billion euros). A performance that he achieved while retaining a 5.2% reduction of its quarterly sales to be about 49,000 billion won.

To explain this profitability, the experts point out the very good sales of the other divisions of Samsung Electronics. Certainly his pole in charge of mobile devices, has suffered from the crisis of the Galaxy Note 7. First, he had to mobilize, according to the analysts, more than 1,000 billion won (800 million euros) to cover the recall of 2.5 million of the smartphones believed to be equipped with a defective battery. He has still been penalized by the suspension, for a few weeks, sales of the new phablet top of the range brand.

Semi-conductors in the rise

But the other branches have not been sprayed by this bad publicity. “The division semi-conductors is the strong point with an operating profit that we believe to 3,400 billion won in the third quarter, ” explained this weekend, Mark Newman of Bernstein Research, in a note to clients.

With the understanding that the smartphones could not forever bear his growth, Samsung Electronics has reinvested heavily in recent years in the semiconductor industry, which had originally been its strength. He is one of the world leaders in memory chips NAND and DRAM, and is particularly taxed in the transition to the models “3D NAND” chips, offering layers upon layers – which will soon dominate the market, especially in the enterprise servers.

in addition, Samsung Electronics has benefited, the last quarter, of the conversion of more and more asian producers of smartphones with screens organic light emitting diodes, or OLED. According to IHS, the production of OLED screens will surpass that of LCD screens as soon as 2020. However, the giant south Korean is one of the few, with LG Display, to be able to mass produce these screens.

Pointing these positions of strength, investors are betting, after the digestion of the fiasco of the Galaxy Note 7, on a new surge in profits by the end of the year. According to Hyundai Securities, Samsung Electronics is now able to generate an operating profit of 30.100 billion won in 2016, which is 24 billion euros.