Quarterly income of KRW 67.40 trillion, working revenue at KRW 2.43 trillion

Reminiscence market situations to get well in 2024; macroeconomic uncertainties anticipated to persist

Samsung Electronics immediately reported monetary outcomes for the third quarter ended September 30, 2023.


Whole consolidated income was KRW 67.40 trillion, a 12% improve from the earlier quarter, primarily because of new smartphone releases and better gross sales of premium show merchandise. Working revenue rose sequentially to KRW 2.43 trillion based mostly on sturdy gross sales of flagship fashions in cellular and powerful demand for shows, as losses on the System Options (DS) Division narrowed.


The Reminiscence Enterprise lowered losses sequentially as gross sales of excessive valued-added merchandise and common promoting costs considerably elevated. Earnings in system semiconductors have been impacted by a delay in demand restoration for main functions, however the Foundry Enterprise posted a brand new quarterly excessive for brand spanking new backlog from design wins.


The cellular panel enterprise reported a big improve in earnings on the again of latest flagship mannequin releases by main clients, whereas the big panel enterprise narrowed losses within the quarter.


The System eXperience (DX) Division achieved strong outcomes because of sturdy gross sales of premium smartphones and TVs. Income on the Networks Enterprise declined in main abroad markets as cellular operators scaled again investments.


Harman posted a quarterly report in working revenue, led by greater gross sales of automobile audio merchandise amid an total improve in orders from automotive clients and in addition client audio merchandise reminiscent of moveable audio system.


Within the fourth quarter, the DS Division will concentrate on gross sales of excessive value-added merchandise reminiscent of Excessive Bandwidth Reminiscence (HBM) whereas additionally strengthening its technological management. Each the DX Division and Samsung Show Company (SDC) will search to keep up strong profitability by specializing in premium markets.


The Reminiscence Enterprise plans to broaden gross sales of HBM3 merchandise and can tackle rising demand for brand spanking new interfaces whereas growing the portion of superior nodes. System semiconductors are anticipated to put up improved outcomes on the again of latest merchandise for cellular clients.


SDC expects to keep up sturdy efficiency within the cellular panel enterprise, pushed by sturdy demand for premium OLED panels for smartphones. The big panel enterprise will broaden QD-OLED gross sales, led by year-end seasonal demand.


The DX Division will attempt to keep up strong profitability by reinforcing methods for flagship smartphones and increasing gross sales of premium tablets and wearable merchandise. For TVs, the Firm expects strong seasonal demand for prime value-added fashions. The Networks Enterprise will search to safe new orders in abroad markets, whereas the Digital Home equipment Enterprise will concentrate on gross sales of premium merchandise and strengthening the product combine.


Harman will search to put up one other sturdy quarter by increasing gross sales of audio merchandise throughout end-year seasonality in addition to addressing the persevering with demand for automotive merchandise.


In 2024, whereas macroeconomic uncertainties are prone to persist, reminiscence market situations are anticipated to get well. The DS Division will search to broaden gross sales of superior node merchandise and plans to satisfy demand for high-performance, high-bandwidth merchandise by growing gross sales of HBM3 and HBM3E with the industry-leading HBM manufacturing capability within the {industry}. For the Foundry Enterprise, the second technology 3-nanometer (nm) Gate-All-Round (GAA) course of will begin mass manufacturing and operations will start at its new manufacturing unit in Taylor, Texas. Moreover, within the Superior Package deal enterprise, manufacturing will start, based mostly on the a number of orders it has obtained from home and abroad HPC clients, together with orders for the Firm’s turnkey service that mixes logic, HBM and a couple of.5D superior packaging applied sciences.


For SDC, the cellular panel enterprise plans to satisfy growing demand for brand spanking new functions, whereas the big panel enterprise will enhance profitability by including new merchandise and enhancing yields.


The DX Division will concentrate on the premium market by growing gross sales of flagship smartphone fashions and revolutionary TV merchandise. The Firm plans to broaden the appliance of AI, present tailor-made hyper-connected experiences through SmartThings and safe applied sciences in new areas reminiscent of XR. The Networks Enterprise will goal to extend income by in search of enterprise alternatives abroad and reinforcing know-how management in core 5G chips and virtualized Radio Entry Community (vRAN) options.


The Digital Home equipment Enterprise plans to strengthen the management in premium segments with world launches of home equipment that includes AI know-how. The Firm plans to proceed advancing the connectivity expertise between SmartThings-based digital home equipment and different gadgets.


Harman is anticipated to safe orders in new areas together with automotive shows and can tackle demand for high-growth merchandise reminiscent of dwelling audio tools.


Within the third quarter, Samsung Electronics’ capital expenditure reached KRW 11.4 trillion, together with KRW 10.2 trillion spent within the System Options (DS) Division and KRW 0.7 trillion in Samsung Show Company (SDC). The cumulative complete for the January-September interval is KRW 36.7 trillion, with KRW 33.4 trillion allotted to the DS Division and KRW 1.6 trillion to SDC.


The complete-year capital expenditure for 2023 is anticipated at roughly KRW 53.7 trillion, together with KRW 47.5 trillion allotted to the DS Division and KRW 3.1 trillion to SDC.


Spending on reminiscence is anticipated to be concentrated in Pyeongtaek, which incorporates finishing the P3 infrastructure and progressing the P4 framework for mid- to long-term provide. The Firm stays dedicated to investing in new applied sciences, reminiscent of securing industry-leading HBM manufacturing capability. Foundry investments are anticipated to extend from final 12 months, centering on manufacturing capability enlargement in Pyeongtaek for the EUV course of in addition to for infrastructure funding in Taylor. For SDC, investments will primarily concentrate on increasing capability for versatile shows and OLED merchandise for IT functions.



Foundry Achieves Document Backlog From Design Wins; Reminiscence Demand To Get better in 2024

The DS Division posted KRW 16.44 trillion in consolidated income and KRW 3.75 trillion in working losses within the third quarter.


For the Reminiscence Enterprise, the PC and cellular demand improved by growing adoption of high-density merchandise in each DRAM and NAND and the completion of consumers’ stock changes. The server demand for generative AI-oriented, high-density and high-end merchandise remained sturdy compared to the sluggish demand for typical servers.


With a concentrate on bettering profitability, the Reminiscence Enterprise continued to broaden gross sales of advanced-node merchandise reminiscent of HBM, DDR5, LPDDR5x and UFS 4.0, and it additionally strived to scale back stock ranges by manufacturing adjustment somewhat than by aggressive gross sales enlargement.


Total, bit development got here in underneath steering however the common promoting value (ASP) of each DRAM and NAND noticed some respectable will increase when in comparison with the earlier quarter.


Trying to the fourth quarter, due to results of peak seasonality together with year-end promotions and launches of latest smartphones by main cellular clients, the demand for PCs and cellular is probably going to enhance. Moreover, the pattern of high-density penetration for each PCs and cellular gadgets has been accelerating greater than forecasted. Cloud service suppliers’ capital expenditure is targeting generative AI, so the related server demand is anticipated to stay sturdy.


The Reminiscence Enterprise will broaden the gross sales portion of extremely worthwhile automotive merchandise and HBM3 mass-volume enterprise for main clients, according to rising demand for generative AI. By means of the ramp-up of Pyeongtaek Line 3, Samsung will proactively tackle the rising demand for brand spanking new interfaces reminiscent of DDR5, LPDDR5x, PCIe Gen5 and UFS 4.0.


Waiting for 2024, PC and cellular demand is prone to profit from the arrival of some substitute cycles for merchandise offered in the course of the preliminary part of the pandemic. For DRAM, because of the unfold of On-System AI, the high-density pattern within the flagship and high-end segments is anticipated to proceed.


Total reminiscence demand is anticipated to get well steadily due to growing demand for AI and normalizing stock ranges at clients, however numerous components that may have an effect on the server market — reminiscent of geopolitical points and IT spending traits which might be associated to macroeconomic situations and centered on generative AI — have to be repeatedly monitored.


Within the third quarter, the System LSI Enterprise posted a slower than anticipated enchancment in earnings because of a delayed restoration in semiconductor demand and the influence from stock changes.


Throughout the quarter, the event of E2400 was accomplished, which has considerably improved efficiency for the CPU, GPU and NPU when in comparison with its predecessor. As well as, the Cell Show Driver IC (DDI) achieved the very best quarterly gross sales this 12 months on the again of a brand new product launched by clients, whereas the 200-megapixel picture sensor has expanded the appliance from wide-angle cameras to telephoto cameras.


Within the fourth quarter, the System LSI Enterprise expects earnings to enhance considerably, as provide to cellular buyer’s new merchandise is predicted to extend. The cellular SoC is within the ultimate phases of growth for subsequent 12 months’s flagship smartphones and is poised to broaden the enterprise portfolio by concentrating on world clients for the modem enterprise, whereas additionally enhancing the answer capabilities for On-System AI.


In 2024, because the cellular market is anticipated to pursue gross sales development by growing the portion of premium fashions, the System LSI Enterprise will even search development by growing gross sales of flagship merchandise and increasing the enterprise space past the cellular market.


Earnings on the Foundry Enterprise remained weak as a gradual restoration in main functions together with cellular led to a delay in fab utilization price enchancment. Nevertheless, the Foundry Enterprise did obtain a quarterly report backlog for brand spanking new design wins, centering on HPC functions.


Within the fourth quarter, earnings are anticipated to enhance as demand for semiconductors will possible improve with the launch of latest merchandise by main clients. The Foundry Enterprise is stabilizing the GAA processes by repeatedly bettering the yield of the second-generation 3nm course of, and it additionally plans to safe a design infrastructure that displays the Silicon outcomes for 2nm.


Waiting for 2024, the foundry market is anticipated to return to a state of development with the restoration in cellular demand and persevering with improve in HPC demand. The Foundry Enterprise plans to mass produce the second-generation 3nm course of and the fourth-generation 4nm course of for HPC functions. It is going to additionally strengthen the general product portfolio by specializing in the event of specialty processes reminiscent of RF and eMRAM to broaden into numerous functions reminiscent of HPC, automotive and client functions.



Cell Show Posts Stable Outcomes, Will Proceed Give attention to Excessive-Finish Market

SDC posted KRW 8.22 trillion in consolidated income and KRW 1.94 trillion in working revenue for the third quarter.


For the cellular show enterprise, SDC noticed a slight improve quarter-on-quarter in market demand on the again of seasonal demand and launches of latest merchandise by main smartphone makers. SDC achieved strong outcomes by specializing in premium OLED, with the polarizing pattern intensifying between high-end and mid-range-and-below markets.


For the big show enterprise, SDC noticed earnings enhance from the earlier quarter because it targeting high-end merchandise whereas strengthening operational fundamentals resulted in enhanced yields and lowered losses.


Within the fourth quarter, SDC expects gross sales within the cellular show enterprise to stay comparatively sturdy due to seasonal results within the smartphone and IT markets. Nevertheless, development could also be restricted as lingering inflation and rising rates of interest influence client sentiment. SDC will attempt to generate comparable outcomes quarter-on-quarter by leveraging competitiveness within the high-end market and that includes launches of latest foldable merchandise.


For the big show enterprise, regardless of issues over extended tepid demand because of the financial downturn, SDC will proceed its efforts to scale back losses with an enhanced product combine together with an elevated share of displays.


In 2024, despite persistent and opposed macro components, SDC will search to safe sturdy outcomes by using its huge capabilities, together with preemptive investments, growth of differentiated applied sciences and efficient administration to make sure steady high quality and yield.


Moreover, as its strategic clients are releasing new merchandise that includes OLED within the foldable smartphone, IT OLED, automotive and gaming segments, SDC will actively promote OLED’s distinctive promoting factors and create a turning level out there.


Specifically, SDC will keep its {industry} management by creating not solely know-how that caters to buyer wants, but in addition an entire provide chain — each upstream and downstream — within the high-potential AR/VR markets.



Cell Achieves Double-Digit Revenue, Will Leverage Vacation Season in This autumn

The MX and Networks companies posted KRW 30.00 trillion in consolidated income and KRW 3.30 trillion in working revenue for the third quarter.


Total market demand elevated from the earlier quarter, pushed by a restoration within the world smartphone market. The gross sales and profitability of the MX Enterprise elevated quarter-on-quarter, pushed by the profitable launch of latest flagship fashions. New foldable gadgets, tablets and wearables recorded sturdy gross sales, supported by a steady provide, and the Galaxy S23 sequence, launched within the first half of 2023, additionally maintained strong gross sales momentum.


Within the fourth quarter, because of seasonality, the smartphone market is anticipated to develop and expertise intensified competitors, particularly within the premium section. Competitors can also be anticipated to extend within the mass-market section, whereas market uncertainties are anticipated to stay because of ongoing geopolitical instability.


The MX Enterprise will proceed to keep up regular gross sales of its new foldable merchandise and the Galaxy S23 sequence with numerous gross sales promotions in anticipation of the year-end vacation season. For tablets and wearables, the MX Enterprise will broaden gross sales with a concentrate on new premium merchandise, leveraging seasonality and strengthening advertising and marketing campaigns in shut collaboration with companions.


In 2024, smartphone market demand is anticipated to rebound as client sentiment stabilizes in anticipation of a world financial restoration, and development within the premium section is anticipated to proceed. The premium section of the pill market can also be anticipated to develop, whereas the smartwatch market is forecasted to realize double-digit development, with the True Wi-fi Stereo market set to develop modestly.


The MX Enterprise will concentrate on additional enhancing the smartphone expertise for purchasers, in search of double-digit development in annual flagship shipments and above-market smartphone income development. For tablets, an emphasis will likely be positioned on strengthening the premium product lineup, whereas for wearables, precedence will likely be on increasing gross sales of latest fashions and enhancing wellness options.


Furthermore, the MX Enterprise will advance generative AI know-how in core options to ship hyper-personalized experiences, in addition to purchase applied sciences in future development areas reminiscent of XR, Digital Well being and Digital Pockets.


By means of these efforts, the MX Enterprise goals to realize annual development in income and revenue in 2024 whereas optimizing assets to adapt to unstable market adjustments and enhance profitability.



Visible Show and Digital Home equipment To Give attention to Securing Profitability

The Visible Show and Digital Home equipment companies posted KRW 13.71 trillion in consolidated income and KRW 0.38 trillion in working revenue within the third quarter.


Total market demand for TVs elevated quarter-on-quarter within the third quarter, led by seasonality, however declined year-on-year because of numerous macroeconomic components affecting client demand.


The Visible Show Enterprise improved year-on-year profitability because it expanded its management within the premium market to concentrate on promoting high-value-added merchandise — together with Neo QLEDs, OLEDs and Tremendous Massive TVs — whereas lowering total prices, particularly materials prices.


Within the fourth quarter, demand uncertainty is anticipated to stay unresolved because of numerous dangers within the enterprise atmosphere, aside from the premium market, the place strong demand is projected.


The Visible Show Enterprise will make sure the seize of peak-season demand by enhancing its competitiveness in each on-line and offline channels. As well as, it goals to safe profitability by bettering its high-value-added product combine with Neo QLEDs, Life-style Screens and Tremendous Massive TVs.


In 2024, the TV market might fluctuate because of the exterior dangers that have been additionally current in 2023. Nevertheless, client sentiment is anticipated to show round from this 12 months and barely enhance to alleviate the decline in market demand.


The Visible Show Enterprise will proceed to innovate TV merchandise, specializing in premium and life-style screens, to steer the ultra-high-definition and ultra-large measurement TV market — particularly concentrating on demand related to main sports activities occasions scheduled in 2024.


The Visible Show Enterprise will proceed to heart on the basics of TV, together with image and sound high quality, in addition to different options which might be extremely valued out there, to permit clients to take pleasure in differentiated display experiences.

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