Samsung Electronics Ranked 3rd in Global Semiconductor Operating Profit Last Year... Intel and TSMC Lead

[Asia Economy Reporter Suyeon Woo] Last year, Samsung Electronics ranked third in terms of operating profit among global semiconductor companies. Despite struggling amid global adversities such as the COVID-19 pandemic and the US-China trade dispute, Samsung Electronics lost the industry lead to Intel and TSMC.

According to the financial investment industry on the 24th, Samsung Electronics' semiconductor division's annual operating profit for last year (based on provisional results) was estimated at 19 trillion KRW, a 35% increase compared to the previous year. This amount is less than last year's Intel (23.7 billion USD / 26.2 trillion KRW) and TSMC (566.5 billion TWD / 22.37 trillion KRW).

In terms of revenue, Intel achieved the highest sales with 77.9 billion USD (approximately 86 trillion KRW), followed by Samsung Electronics with about 73 trillion KRW, ranking second. TSMC took third place with 1.3393 trillion TWD (52.9 trillion KRW).

Samsung Electronics Seocho Building

Samsung ranked first globally in both sales and operating profit during the memory semiconductor super boom period of 2017-2018, but except for that period, it mostly yielded first place to Intel and remained in second place. However, since 2019, as the foundry market rapidly grew, Samsung has gradually been overtaken by Taiwan's TSMC, the world's number one foundry company in market share.

TSMC recorded operating profits similar to Samsung Electronics in 2019 and surpassed Samsung's profits last year, securing the industry's second place. Even considering the unfavorable exchange rate environment in the fourth quarter of last year, TSMC's profits exceeded those of Samsung Electronics.

The gap is also widening in terms of operating profit margin, which indicates profitability from operating activities. TSMC, focusing its capabilities on the foundry business, posted an operating profit margin of 42.3% last year, exceeding 40%. In comparison, Samsung Electronics' semiconductor division's operating profit margin last year is estimated to be around 26% on average. Intel's margin is about 30.4%.

Samsung Electronics will announce its finalized fourth-quarter results for last year on the 28th, along with the full-year results. The industry expects Samsung to unveil a new shareholder return policy on that day, as well as a large-scale investment plan for foundry facility investments.