Samsung’s mobile unit has recorded a drop in sales and profitability in Q3 due to continued supply constraints, weaker demand and increased marketing spending on its foldable line.
The device giant’s smartphone shipments dropped 18.2 per cent year-on-year to around 72 million units and tablets were down 22.2 per cent at 7 million, with blended ASP including at about $250.
It’s IT and Mobile Communications revenue fell 7 per cent to US$24.3 billion, with operating profit 24.5 per cent lower at US$2.9 billion, due in part to rising marketing costs for its foldable line.
Mobile Communications VP Kim Sung-koo used an earnings call to explain that uncertainty over component supplies is likely to linger in the current quarter, as it steps up efforts to increase sales of premium smartphones by focusing on foldable and 5G models.
He said it expects to maintain double-digit operating profit margins in Q4.
Kim forecast growth in the smartphone market and double-digit gains for wearables in 2022, but cautioned the risk of a rise in Covid-19 (coronavirus) outbreaks continues.
Meanwhile, Samsung’s network business is targeting growth in North American and southwest Asia, Kim said.
On a group level, net profit grew 31.3 per cent to US$10.52 billion on sales of US$63.3 billion, up 10.5 per cent.
Semiconductor business sales increased 40 per cent to US$22.6 billion, with memory improving 46 per cent to US$17.8 billion.
