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Samsung profits down, but phones are bouncing back

Samsung, the world’s biggest phone manufacturer, has published its third-quarter earnings report, and once again it’s a mixed bag. On one hand, profits and revenue are both down year on year, but on another the mobile division is enjoying something of a resurgence.

In all, the company reported 62 trillion won (around £41bn) in revenue and 7.78 trillion won (around £5.1bn) in operating profit. That sounds strong, but represents a year-on-year dip of 5 and 56%.

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But there were bright spots, and there’s nowhere brighter than in mobile. In all, the division posted revenue of 29.25 trillion won (around £19.5bn), up 17%, while profit hit 2.92 trillion won (close to £2bn).

While the company doesn’t break down the figures by individual handsets, Samsung did highlight “strong sales of the Galaxy Note 10 and A series,” adding that there were also better profit margins on “mass-market models”. Crucially, Samsung adds that the Galaxy Note 10 “exceeded its predecessor’s sales performance, presenting double-digit growth in volume,” which suggests the gamble of offering a regular and Plus version has paid off.

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So there are definitely reasons to be cheerful, but “continued weakness in the memory chip market” is still holding the company back. In that respect, Samsung says that “uncertainties linger,” but it’s hopeful that DRAM inventory will “normalise in the first half of 2020.” 

That said, the company previously predicted that smartphone and chip sales would pick up this year, and clearly only one part of that has come true. We’ll just have to see what the Q4 report brings.  

Do you think the memory chip market will be bouncing back in 2020, or can Samsung expect more weak quarters before it gets better? Let us know what you think on Twitter: @TrustedReviews.

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