Semiconductor and Home Appliance Industries Announce Confirmed Results for Last Year
Samsung and LG Watch Closely to See if They Can Surpass Intel and Whirlpool Respectively
Samsung Electronics achieved a record high performance with annual sales exceeding 279 trillion won. Samsung Electronics announced on the 7th that, based on its preliminary consolidated results for last year, sales reached 279.04 trillion won, and operating profit was 51.57 trillion won. The photo shows the Samsung Electronics Seocho building. Photo by Mun Ho-nam munonam@
[Asia Economy Reporter Lee Hye-young] The confirmed earnings announcements for the fourth quarter of last year from major companies such as Samsung Electronics, LG Electronics, and SK Hynix are imminent. Despite external factors such as the prolonged COVID-19 pandemic, resulting global supply chain instability, and rising raw material prices, these companies are expected to post strong performances.
According to industry and securities sources on the 23rd, the semiconductor industry is expected to have achieved record-high sales last year.
Samsung Electronics will announce its confirmed earnings for the fourth quarter and the full year of last year on the 27th. In its previously announced preliminary earnings disclosure, Samsung Electronics reported achieving a record high of 279 trillion 400 billion KRW last year.
In particular, Samsung Electronics is expected to reclaim the number one position in the semiconductor sector, surpassing Intel. Intel will also release its last year's earnings on the same day as Samsung Electronics, Korea time.
Market research firm Gartner forecasted that Samsung Electronics will achieve the world's number one semiconductor sales for the first time in three years since 2018. Gartner estimated Samsung Electronics' semiconductor sales last year at $75.95 billion (approximately 90.3 trillion KRW), a 31.6% increase from the previous year, surpassing Intel's $73.1 billion. The market share projections are 13.0% for Samsung Electronics and 12.5% for Intel.
There is also interest in whether Samsung Electronics will mention its capital expenditure plans for this year during the post-earnings conference call.
Foundry competitor Taiwan's TSMC announced plans to invest up to $44 billion (approximately 52.3 trillion KRW) this year. Intel, which has entered the foundry market, also announced aggressive investment plans, including building a semiconductor manufacturing plant in the U.S. worth $20 billion (approximately 24 trillion KRW) and increasing its investment scale to $100 billion over the next 10 years.
SK Hynix is also expected to record record-high earnings. The securities industry's forecast for SK Hynix's annual sales last year is 42.9984 trillion KRW, with an operating profit of 12.3379 trillion KRW.
This surpasses the 2018 sales of 40.0445 trillion KRW during the semiconductor supercycle, and the operating profit is the highest in three years since 2018's 20.0843 trillion KRW. This is attributed to increased demand for remote work and learning due to the pandemic, along with a surge in data center demand, leading to a strong memory semiconductor market.
Attention is also focused on whether LG Electronics can claim the title of 'world's number one home appliance brand' in its earnings announcement on the 27th.
LG Electronics announced through its preliminary fourth-quarter earnings that it recorded sales of 74.7219 trillion KRW and an operating profit of 3.8677 trillion KRW last year. Sales were the highest ever, and operating profit was the second highest ever, following 3.9 trillion KRW in 2020. The increase in premium home appliance sales, especially due to the rise in indoor living caused by COVID-19, is analyzed to have positively influenced the earnings through increased demand for home appliances.
On the same day LG Electronics announces its earnings, U.S.-based Whirlpool will also release its results. It is estimated that LG Electronics surpassed Whirlpool for the first time last year in global home appliance (H&A) market sales, including refrigerators and washing machines.
Up to the third quarter of last year, LG Electronics' H&A division's cumulative sales were 20.5841 trillion KRW, approximately 2 trillion KRW ahead of Whirlpool during the same period. Industry experts generally believe that Whirlpool was unlikely to have closed the gap with LG Electronics during the fourth quarter.
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