Samsung Electronics' 'Record High Sales' Brake... Retreats to 77 Trillion in Q2

Record Second Highest Sales of 77 Trillion Won in Q2 This Year
All-Time Highest Sales Record Broken

[Asia Economy Reporter Park Sun-mi] Samsung Electronics posted sales of 77 trillion won in the second quarter of this year, the second highest ever.

On the 7th, Samsung Electronics announced its preliminary results for the second quarter of this year, recording consolidated sales of 77 trillion won and operating profit of 14 trillion won. Compared to the same period last year, sales and operating profit increased by 20.94% and 11.38%, respectively, but both declined by 1% and 0.85% compared to the previous quarter.

Considering that the sales and operating profit growth rates were 18.9% and 50.5%, respectively, during the first quarter, which was traditionally an off-season for the electronics and semiconductor industries, the second quarter results fell short of expectations.

The streak of record quarterly performance has come to a halt. Since achieving the highest-ever sales record of 73.98 trillion won in the third quarter of last year, Samsung Electronics consecutively broke records for three quarters with 76.57 trillion won in the fourth quarter and 77.78 trillion won in the first quarter of this year.

The second quarter results fell short of market expectations. According to financial information firm FnGuide, securities firms projected Samsung Electronics’ second quarter consensus (average forecast) at 77.2218 trillion won in sales and 14.6954 trillion won in operating profit. The actual figures were 0.3% and 4.7% below these estimates, respectively.

Within the industry, there is an assessment that Samsung Electronics performed well despite global adversities such as the Russia-Ukraine war, lockdowns in China due to COVID-19, inflation, and economic slowdown. However, concerns have been raised that these adverse factors are likely to continue into the second half of the year, potentially leading to a deterioration in performance.

In fact, Samsung Electronics’ management mentioned the word “uncertainty” dozens of times during the conference call for the first quarter, when the company recorded its highest quarterly performance, indicating the challenging market conditions. The outlook for all businesses included countermeasures reflecting the internal and external uncertainty environment, and concerns were clearly reflected in the second quarter results.

If the current pace continues, Samsung Electronics’ annual sales for this year are estimated to barely surpass 300 trillion won. Samsung Electronics’ annual sales showed a sharp increase from 230.4 trillion won in 2019 and 236.81 trillion won in 2020 to 279.6 trillion won last year.