South Korean technology giant Samsung Electronics 005930,
said third-quarter net profit fell 38% on the year but more than tripled during the quarter to beat market consensus as its semiconductor business narrowed losses amid signs of demand recovery.
The world’s largest maker of memory chips, smartphones and televisions said on Tuesday that net profit for the quarter ended September was 5.844 trillion won ($4.34 billion), up from KRW9.389 trillion a year earlier and KRW1.724 trillion in the previous quarter. .
Revenue for the third quarter was KRW67.405 trillion, while operating profit came in at KRW2.434 trillion, largely in line with the company’s preliminary forecasts.
The company said its memory chip segment remained in the red for the third consecutive quarter, but quarterly losses fell to KRW3.757 trillion in the third quarter, after losses of more than KRW4.0 trillion in each of the first and second quarters .
The company also said its smartphone and display panel businesses performed strongly in the third quarter, offsetting losses in the semiconductor segment.
It said memory chip demand is likely to continue improving in the fourth quarter and next year due to customers’ new product releases and the boom in artificial intelligence.
Samsung also expects demand for high-performance computer chips used in generative AI applications to remain strong in the coming quarters.
The company has scaled back semiconductor production to reduce inventory and support prices for memory chips, as it seeks to increase production capacity for AI chips and other high-end products to meet brisk demand.
Samsung said on Tuesday it expects facility investment to reach an annual record of KRW 53.7 trillion in 2023, while KRW 11.4 trillion will be spent in the third quarter.