Samsung just posted its highest-ever quarterly revenue of $59.05 billion, grabbing some of Huawei's share of the mobile market
- Samsung posted record quarterly revenues of $59.05 billion on Thursday, but warned that rising smartphone competition could hit its fourth-quarter profits.
- Its smartphone sales surged almost 50%, as the South Korean company gained market share from rival Huawei, which has struggled with US restrictions.
- Its home appliance and TV business posted record earnings.
- "Global demand is forecast to increase year-on-year, but uncertainties are unlikely to ease given the possibility of additional waves of the pandemic," Ben Suh, Samsung's executive vice president of investor relations, said.
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Samsung posted its highest-ever quarterly revenues on Thursday thanks to surging smartphone sales, gaining market share while rival Huawei struggled with US restrictions.
But the South Korean tech firm warned that its fourth-quarter profit would likely fall due to weak server chip demand, the Covid-19 pandemic, rising smartphone competition, and US-China trade tensions.
The company posted a near 50% surge in smartphone sales in the quarter to September. It posted its highest quarterly smartphone profit since 2014, at 4.45 trillion won ($4 billion), citing the success of new flagships the Galaxy Note20 and Galaxy Z Fold2, as well as stronger sales of mass-market models in India.
It expected mobile chip demand to rise in the fourth quarter, as Chinese customers boost orders following US restrictions on Huawei — but said its smartphone sales would decline and its marketing costs would increase.
"Looking ahead, Samsung Electronics expects profit to decline in the fourth quarter amid weakening memory chip demand from server customers and intensifying competition in mobile phones and consumer electronics."
"For 2021, the company expects a recovery in overall global demand but uncertainties will remain over the possibility of recurring epidemic waves of Covid-19," it said in a statement.
Samsung had applied for its US license to export chips to Huawei and was still waiting for the result, it said.
Record earnings in some categories as smartphone, TV, and wearables demand rises
Samsung's chip profit leapt 82% to 5.54 trillion won ($4.89 billion) from a year earlier, as higher sales of low- and mid-end smartphones and inventory buildup from Huawei ahead of the US restrictions offset weak demand from servers.
It also posted record earnings for its Samsung's home appliance and TV business in third quarter, driven by "stay-at-home" trends, and noted increased sales of tablets and wearables including the Galaxy Tab S7, Galaxy Watch3, and Buds Live.
The company posted an operating profit of 12.35 trillion won ($10.89 billion) in the quarter to September – its highest in two years. This represented a 59% jump from the same period last year, and a 52% increase just from the previous quarter.
Revenue climbed 8% to 66.96 trillion won ($59.05 billion). Net profit rose 49% to 9.36 trillion won ($8.25 billion).
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