Seoul: Samsung Electro-Mechanics Co. reported a notable decrease in its net profit for the second quarter, revealing a 24.3 percent drop compared to the same period last year. This decline is attributed primarily to the impact of a strong local currency.
According to Yonhap News Agency, the company's net income for the April-June period totaled 137.2 billion won (US$98.6 million), a significant decrease from 172.4 billion won recorded a year earlier. This figure fell short of market expectations, as analysts had projected a net profit of around 171.6 billion won, based on a survey conducted by Yonhap Infomax, the financial data firm of Yonhap News Agency.
The depreciation of dollar-denominated orders due to a stronger Korean won was identified by Samsung Electro-Mechanics as the primary reason for the year-on-year decline in net profit. Despite these currency challenges, the company managed a slight increase in operating profit, which rose by 0.7 percent on-year to 213 billion won. Additionally, the company's revenue saw an 8.2 percent increase, reaching 2.78 trillion won during the same period.
Samsung Electro-Mechanics highlighted that its premium product lineup, which includes automotive multilayer ceramic capacitors (MLCC) for artificial intelligence (AI) and chip packaging solutions for servers, played a significant role in driving revenue and operating profit growth, even amidst unfavorable foreign exchange rates.
Looking forward, the company anticipates a continued surge in demand for components utilized in smart devices and AI servers in the upcoming third quarter.