Samsung Q2 profits strong thanks to memory

Samsung posted 8.15 trillion won in second quarter operating profit, with its semiconductor business contributing 5.43 trillion won of that.

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Samsung Electronics has posted 8.15 trillion won in operating profit and 53 trillion won in sales for the second quarter of 2020, the company said on Thursday.

It is a rise of 23.5% and drop of 5.6%, respectively, from a year prior.

The company's semiconductor business contributed the lion's share in operating profit with 5.43 trillion won.

Strong demand for memory from data centres and PCs due to the impact of the COVID-19 pandemic helped earnings for the quarter, Samsung said.

Uncertainties remain for the second half of 2020 due to the pandemic, but the South Korean tech giant expects demand to recover going forward thanks to upcoming smartphone and game console launches.

Samsung's mobile business, despite store closures around the world due to the outbreak, still contributed the second highest level of profit with 1.95 trillion won.

Smartphone sales were hurt by the COVID-19 pandemic but the business managed costs efficiently to defend its profitability, Samsung said.

The conglomerate expects fierce competition going forward amid uncertainties from the pandemic. 

Samsung will launch new flagship models within the Galaxy Note and Fold series and expand low to mid-tier model sales while continuing its efforts to improve profitability, it said.

Samsung's display panel business, meanwhile, contributed 300 billion won in operating profit despite demand falling thanks to a one-time payment. The company didn't elaborate on what the payment included, but it is likely the penalty paid by Apple for not buying enough OLED panels, similar to what occurred a year prior.

The South Korean tech giant's consumer electronics business also contributed 730 billion won. Sales were hurt from the COVID-19 pandemic but efficient management of the global supply chain to meet short-term demand for TVs helped profits, the company said.

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