Samsung Electronics posts record Q3 profits of $10 bn

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South Korean tech giant Samsung Electronics logged a record profit of 11.2 trillion won or 10 billion US dollars in the July to September period, the company said Tuesday.

The world's biggest memory chip and smartphone maker saw its net profits soar 148 percent despite a rough ride in the past year, after previous group chief Lee Jae-yong was jailed for bribery and a global recall of its flagship Galaxy Note 7 handset after several burst into flames.

However the company's financial performance was salvaged by strong demand for its memory chips and a recovery in smartphone sales with the roll-out of the new generation Galaxy Note 8.

The figures come only two weeks after chief executive Kwon Oh-Hyun resigned, saying the South's biggest firm was facing an "unprecedented crisis" and its current profitability was "merely a fruit of decisions and investment made in the past".

The tech firm also named a new and younger generation of top managers, a move to fill a previous leadership vacuum following the arrest and conviction of group scion Lee Jae-Yong on bribery charges earlier this year

Lee, who was sentenced to five years, says he is innocent and is appealing.

Samsung seems to have recovered from the crisis last year that ended in the discontinuation of sales of its flagship model Galaxy Note 7. /Reuters Photo.

The 2017 Galaxy Note 7 recall - due to exploding batteries - also dealt a crippling blow to the firm's mobile business.

But Samsung described Tuesday's numbers as an "overall robust performance".

Third-quarter sales also surged to a quarterly record of 62.05 trillion won, according to a regulatory filing.

Its profits and share price have rocketed this year, and it said separately it would double its dividends in 2018. It also confirmed a further share buyback for the fourth quarter.

It would keep dividends fixed for the following two years, it said, but could make further payouts and buybacks depending on cash flow.

/Reuters Photo.‍

Samsung's semiconductor unit, which has been riding high on surging global demand for memory chips for servers and smartphones, saw its Q3 operating profit soar nearly 200 percent to 9.96 trillion won, a record figure.

The firm provides memory chips for PCs, servers and mobile gadgets of its own but also other industry rivals including Apple. It is its component business that is helping the firm cushion a fall in sales of its own hardware.

Samsung predicted "positive growth" in the semiconductor business next year as technological advances in artificial intelligence (AI) and machine learning fanned demand for high-powered processor chips.

Samsung has sustained its lead in the market partly by investing massively in building and expanding semiconductor factories, often faster than its rivals.

And its investment in infrastructure, mostly on chip plants, will reach a whopping 46.2 trillion won for this year alone, compared to 25.5 trillion won in 2016, it said.

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Source(s): AFP ,Reuters