Samsung Posts 83% Profit Jump on Chip, LCD Sales

Samsung Electronics Co.‘s net profit surged 83 percent in the second quarter to a record high amid increased sales and strength in its semiconductor and flat panel businesses.

Samsung earned 4.28 trillion won ($3.61 billion) in the three months ended June 30, the company said in a regulatory filing. It had net profit of 2.33 trillion won the year before.

The result bested Samsung’s previous all-time high net profit of 3.99 trillion won set in the first quarter of this year. The company also reported record operating profit.

Samsung Electronics Co. is the world’s largest manufacturer of computer memory chips, flat screen televisions and liquid crystal displays. It ranks No. 2 in cell phones.

The second-quarter results were driven by surging profitability in its semiconductor and LCD businesses, though the company reported operating profit declines in digital media, which includes televisions, and mobile phones.

Samsung manufactures both consumer electronics devices such as flat screen televisions and mobile phones as well as the key components that make them work.

The company makes DRAM, or dynamic random access memory, chips that used mostly in personal computers. It also manufactures NAND flash memory chips used in digital devices such as cameras and smartphones. LCD panels are used in televisions, computer monitors and mobile phones.

The company said total second-quarter sales totaled 37.89 trillion won, 17 percent higher than 32.51 trillion won last year.

“In the second quarter, our component businesses performed very strongly, yet it was a more challenging quarter for our set businesses,” Robert Yi, head of investor relations, said in a release. Set businesses refer to products such as televisions and phones.

He cautioned that the company’s record results may be unsustainable.

“With intensified competition throughout the digital media and mobile industries going forward, it may become a challenge to maintain current profitability levels,” he said.

Shares in Samsung, which released earnings about 25 minutes after the start of trading, fell 1.7 percent higher to 813,000 won. The stock price surged 77 percent in 2009.

SEOUL, South Korea (AP)