As preempted by jittery global markets and analysts, Samsung published underwhelming profits for the third quarter. The South Korean tech giant reported 9.10 trillion won in profits, marking a 274% uptick from last year’s 2.43 trillion Korean won. However, compared to the London Stock Exchange’s (LSEG) projections for the chipmaker, these numbers disappointed markets worldwide.
Samsung Electronics Announces Earnings Guidance for Third Quarter 2024https://t.co/lzha7fj8Mp
— Samsung Electronics (@Samsung) October 8, 2024
Jun Young-Hyun, Samsung Vice Chairman and new head of the device solutions division, issued an apology after the chipmaker published earnings on Tuesday. Analysts polled by LSEG expected profits to touch 11.456 trillion Korean won for the third quarter. To address this disparity, Young-Hyun penned a public apology to customers, investors, and employees. The Vice Chairman acknowledged a crisis at the heart of its underwhelming performance in the third quarter and reassured its global consumer base that “Samsung always turned crises into opportunities, having a history of challenge, innovation, and overcoming.”
He continued to accept accountability, citing that the “management will take the lead in overcoming the crisis and restore [Samsung’s] fundamental technological competitiveness.” According to Young-Hyun, Samsung Electronics must address three pressing concerns: quality checks on technological innovations, foresight to future brave challenges, and working culture within its organizational structure.
As a leading manufacturer of memory chips, Samsung has confirmed recent shipment delays for its HBM3E chips. Daniel Yoo, head of global asset allocation at Yuanta Securities Korea, told CNBC, “Samsung is not taking that market share as aggressively as we have seen in the past. That is the big problem that I think we’re seeing.” In a note by Macquarie Equity Research, analysts concurred that “the company needs to remain flexible about its memory supply control since the downfall of conventional DRAM will likely hurt Samsung more than its smaller rivals.”
Shortly after releasing Q3 profits, Samsung stocks slipped by 0.98%. LSEG illustrated a 22% decrease year-to-date in 2024 as a direct consequence of poor profit projections.
