The world's largest memory chip maker reported an operating profit of 12.26 trillion won in the 4th quarter, a 64.3% jump from a year ago, on consolidated sales of 65.98 trillion won, which is also up 23.7% year-on-year.
For all of the year, Samsung saw its annual operating profit jump by 83% to 53.65 trillion won on sales of 239.58 trillion won, a surge of 19% year-on-year.
Even though Koran won currency appreciation and depreciation costs cut into some of its profitability, soaring prices of DRAM and NAND flash memory chips took up the slacks.
Memory chips were the prime growth driver of Samsung’s earnings, accounting for approximately two thirds of its operating profit. Its semiconductor division saws its operating profit more than double to 10.9 trillion won from a year ago.
Global memory chip market remains in short supply, as second-tier chipmakers’ technology migration to below 20nm design rule for DRAM chips has been stalling. Meanwhile, demand still remains strong, as a mushroom of data centers have been springing up across the world, guzzling much of the capacity. The same is true in the NAND flash chip memory market, as their journey up to 3D NAND flash chip production has been dragging on.
All combined, the gap between supply and demand helped push up prices.
Samsung’s display panel business was a money-spinner, too, seeing its operating profit rise to 1.4 trillion won.
Growing demand for OLED panels was a major contributor, as more and more of smartphone makers were building their smartphones with the life-like picture quality OLED display.
Yet, Samsung’s mobile business division saw its operating profit slightly fall to 2.4 trillion won, as competition was mounting in mid-range market, forcing it to squeeze profitability.
Samsung had been losing more grounds to emerging Chinese smartphone makers in China and India, which were luring local customers with low-cost, good performing smartphones.
The Korean tech giant faced hard time in the Chinese market, staying out of the list of top 5 smartphone sellers in China in 2017.