Samsung Electronics reported record revenues of $ 59 billion in the third quarter of this year, thanks to a jump in smartphone sales and a large increase in chip profits.
The Korean technology giant’s third-quarter net profit was $ 8.3 billion, up 49 percent from the same period last year.
Samsung’s smartphone sales increased by 50 percent, while chip revenue increased by 82 percent.
The increase in demand for Samsung’s cell phones and electronic chips is likely to be due to US sanctions against its Chinese rival Huawei.
Huawei has been stockpiling chips, fearing potential US sanctions.
The US Commerce Department announced in August that it would impose sanctions on any foreign company that sells chips to Huawei without first obtaining a license.
The Trump administration has targeted a number of Chinese technology companies due to national security concerns, including Huawei, TikTok and WeChat.
Samsung also saw strong growth in sales of televisions and other home appliances during the July-September period.
Booming market for electronic chips
Samsung’s strong results come amid a boom in the US chip industry.
Electronic chips are used in a wide range of devices, and are found in retail products such as smartphones and consumer electronics, and they are also used in commercial infrastructure such as data centers.
The US chip maker AMD announced this week that it would buy its competitor Xelenx for $ 35 billion.
Last month, the American chip maker Nvidia agreed to buy the British company, ARM, for the portable chip maker, from the Japanese telecom company, SoftBank, for $ 40 billion.
On a larger scale, chip makers have performed well during the Covid-19 pandemic, as the pressure of working from home has increased the demand for certain chips.
In addition to Samsung, the Korean “SK Hynix” also recorded strong profits in the second quarter of the year, when a large part of the world was subject to the restrictions of Covid-19.
US-based Micron Technology also exceeded its quarterly forecast, after forecasting a strong hike in pressure to work at home in June.
Nevertheless, Samsung had expected turbulent times ahead, with profits dropping in the fourth quarter.
The company expects future weakening demand for chips and greater competition in the cell phone and consumer electronics industries.
Samsung’s announcement of its third-quarter numbers comes after the departure of its chairman, Lee Kun-hee, who helped transform Samsung into a global power.
His death could drastically change the company, as his heirs might be forced to sell assets or dividend payments, in order to pay a hefty inheritance tax bill.
There are also lingering questions about his successor, Lee Jae-young, who has run the South Korean tech group since 2014.
Lee Jae-young was twice charged with fraud for his role in a 2015 merger deal and is currently awaiting trial.