Samsung Display & Mobile Business Y/Y Revenue Down 26.5% & 17%, Respectively
August 06, 2018
Samsung reported Q218 operating profit up 5.7 percent to 14.9 trillion won ($13.3 billion) in the second quarter, slightly ahead of its 14.8 trillion won estimate. Revenue for the April-June period fell 4 percent Y/Y to 58.5 trillion won. While the mobile business struggles, the chip business remained Samsung’s top earner in the second quarter as sales to the cloud computing and crypto-currency industries propped up DRAM chip prices even as NAND flash memory prices slipped.
The chip unit posted a record 11.6 trillion won operating profit in the second quarter, up 45 percent from a year ago and nearly 80 percent of its total operating income. Looking at the individual segments that affect the OLED industry, VD, DP and IM, they were all down Y/Y in revenue and operating margin as shown in the next table.
Table 1: Selected Q218 Samsung Financials
* Samsung did not breakout VD’s operating margin.
SEC -- Samsung Electronics
VD -- Visual Display (TVs)
DP -- Display Panel (OLEDs and LCDs)
IM -- IT & Mobile (Smartphones)
Ben Hur from System LSI business (Great Name)
“In the second half of this year, our earnings are likely to return to growth quarter-over-quarter as smartphone makers enter strong seasonality. With respect to the growth will be backed by strong demand for OLED DDIsand high pixel image sensors, the former for use in flagship smartphones and the latter amid increasing adoption of dual camera and triple cameras. With a view to the mid to long term, we will focus on developing cutting-edge chipset for use in 5G, multiple cameras and display panels. By doing so, we will try to lead the market and establish a stable business structure by achieving high growth compared to the market. Regarding the triple camera, the triple camera offers various advantages, such as optical zoom or ultra-wide angle, also extreme low-light imaging. And that's why we're expecting more and more handsets to adopt triple cameras not only in 2018 but next year as well.By next year, about 10% of handsets are expected to have triple cameras. And triple camera adoption will continue to grow even after that point.”
Kwonyoung Choi, Samsung Display.
“In the second quarter, total earnings in the display business decreased quarter-over-quarter due to weakened profitability in both the OLED and SSD business.
Separately, ET News reported that Samsung Display is expected to begin foldable OLED production towards the end of 2018, as Samsung Electronics plans to begin selling foldable phones in the beginning of 2019. Samsung will soon be ready to start producing foldable OLEDs in a new pilot line in its A3 flexible OLED line. In 2018 the company will only be able to produce 100,000 units, and in 2019 the capacity will be about 1 million. It seems that Samsung is in a hurry to have a product out, and is currently ready to start production with low yields and high production costs (according to GBI estimates, the first foldable phone/tablet will cost over $1,800).
ETNews further says that the first phone design will have a large 7" display that will fold inwards and vertically (like a clamshell phone). The display will not fold fully, however - when folded a third of the display will still be visible and will thus operate as an external display.
Kyung Chull Park,Visual Display-- “The TV market in Q2 has decreased from last quarter due to continued global economic slowdown, but the market has grown Y/Y due to sports events of this year. The TV market in the second half is projected to grow Y/Y mainly in the advanced market.
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