Samsung’s Q4 Revenue Is Best Ever

The Korean tech company’s fourth-quarter results reflect more favorable times. Net profit rose 64% to 10.84 trillion won, or about $9 billion, from 6.6 trillion won a year earlier. The company’s semiconductor division is at the forefront.

Headquartered in Suwon, the company reported record sales of 76.57 trillion won for the quarter ended December 31. Compared to 61.6 trillion won a year earlier.

Samsung’s performance was slightly above market expectations. Analysts polled by S&P Global Market Intelligence averaged expectations of 10.7 trillion won in net profit and 75.5 trillion won in revenue.

Samsung, the world’s largest maker of smartphones and TVs, is seen as a collective of the tech industry, as a major electronics maker and component supplier to companies like

Apple Inc.

and

Sony Corporation Corp.

For the full year, Samsung’s net profit increased 51% to 39.9 trillion won, while revenue increased 18% to 279.6 trillion won.

Samsung’s rise as the top chipmaker by revenue comes as the semiconductor industry embarks on spending to create more advanced chips and expand capacity. Intel specializes in microprocessor chips for PCs and servers. , used to be number 1 over the past three decades, give way to Samsung only in 2017 and 2018 when memory chip prices rose sharply.

Last year, however, proved particularly lucrative for Samsung’s memory chip business, which has seen prices skyrocket and is more prevalent around the digital world than Intel’s microprocessors. The South Korean company’s semiconductor sales for 2021 increased 29% year-on-year to 94.16 trillion won, or $78.4 billion.

That’s enough to put Samsung at No. 1 of the chip industry in terms of sales, according to

Gartner Inc.,

a technology market researcher.

Samsung’s strong performance comes from great shake inside Korea’s biggest tech company. Last month, the company replaced all three co-CEOs and consolidation of two business units, which groups mobile and its consumer devices, into one. The company said these actions are intended to help move it into the next phase of growth and strengthen its business competitiveness.

Samsung said it expects memory demand to continue to grow strongly, thanks to data center servers and 5G phones. However, buyers’ appetites may be limited due to production constraints due to component shortages and supply chain issues.

The company is also ramping up investments in contract chip manufacturing, including a new $17 billion plant in Texas. Kang Moon-soo, executive vice president of Samsung’s foundry division, said chip supply will remain tight this year, said on Thursday’s earnings call.

Samsung’s mobile business reported a relatively solid quarter in part due to the strong launch of high-end foldable phones, the Galaxy Z Fold 3 and Galaxy Z Flip 3, which launched in March. August.

The company’s mobile division posted fourth-quarter operating profit of 2.66 trillion won, up 10 percent year-on-year, while revenue rose 30 percent to 28.95 trillion won. However, operating profit declined quarter-on-quarter due to increased marketing expenses. Component shortages are also reducing overall phone production.

Samsung is set to launch its latest flagship smartphone, the Galaxy S22, on February 9. Three versions of the phone are expected to be announced.

Write letter for Jiyoung Sohn at jiyoung.sohn@wsj.com