Memory Chips Send Samsung Profit Soaring

Samsung Electronics Co. reported another record high in quarterly earnings Tuesday as its semiconductor division posted its highest profit ever and tipped another record-breaking quarter is on the horizon, a breathtaking run for a company that is fighting to get its leader out of jail.

The company also announced a monstrous capital investment plan to increase chip production and higher shareholder dividends as the world’s largest chipmaker basks in an unprecedented boom in the memory chip industry that helped it overcome a crisis in its leadership.

The South Korean company’s July-September net income surged 150 percent to 11 trillion won ($9.8 billion), compared with 4.4 trillion won a year earlier.

The result beats analysts’ consensus of 10.9 trillion won, according to financial data provider FactSet.

Sales rose 30 percent to 62 trillion won ($55.1 billion) while operating profit nearly tripled from the previous year to 14.5 trillion won ($12.9 billion), in line with its preview.

Samsung, the world’s largest maker of smartphones, has continued its record-breaking earnings streak thanks to a global boom in memory chips that resulted from a jump in mobile data traffic and rise of cloud computing, even as its de facto chief was sentenced to five years in prison on a conviction for bribery.

Hearings are underway at the appeals court as Lee Jae-yong, Samsung Electronics vice chairman and a grandson of Samsung’s founder, contests the conviction for offering bribe to then-President Park Geun-hye and her close friend to ensure a smooth transition of corporate leadership at Samsung.

Investors are also waiting for Samsung to name a successor to Kwon Oh-hyun, one of Samsung’s three chief executives who are not part of the founding family but climbed the ladder from rank-and-file to overseeing daily management of Asia’s largest consumer electronics company.

Kwon led day-to-day operations of the world’s most successful chip business and was…
Source: Mobile Tech Today

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