In the 4th quarter, while memory request for mobile and PC may encounter softness, growth in AI will keep request at robust levels. Against this backdrop, the Company will concentrate on driving sales of advanced Bandwidth Memory (HBM) and high-density products. The Foundry Business aims to increase order volumes by enhancing advanced process technologies. Samsung Display corp (SDC) expects the request of flagship products from major customers to continue, while maintaining a rather conservative outlook on its performance. The Device eXperience (DX) Division will proceed to focus on premium products, but sales are expected to decline somewhat compared to the erstwhile quarter.
For 2025, the Company will stay focused on enhancing competitiveness in advanced technologies and strengthening leadership in premium products and AI capabilities amid ongoing macroeconomic uncertainties. The DS Division will address request for differentiated products based on advanced technologies and advanced value-added products specified as HBM and server SSDs. In addition, the Company plans to leverage the mass production on the 2 nanometer (nm) Gate-All-Around (GAA) process to win fresh clients. SDC will aim to keep leadership in the high-end product category and broaden its product portfolio. The DX Division will proceed to deliver exceptional client experiences through enhanced AI features and product connectivity.
With over 500 million diverse products being delivered to consumers globally all year, the Company is tailoring its AI technology in each product to aid lead the market. By leveraging the SmartThings platform with 360 million users and capabilities in product intelligence, spatial intelligence, and personalization, the Company plans to firmly establish itself in the home of the future, where AI will be widespread. In the AI era for the home, the Company will focus on the safety of its products, convenience in device connectivity, intelligent technology to save energy and time, and the wellness and well-being of users and their families.
Memory Achieves gross Growth in Q3
The DS Division posted KRW 29.27 trillion in consolidated gross and KRW 3.86 trillion in operating profit in the 3rd quarter.
For the Memory Business, request for AI and conventional servers was strong, as major datacenter and technology companies continued to invest. But mobile request was comparatively soft due to inventory adjustments by any customers, and the supply-demand situation was impacted somewhat by the expanding supply of legacy products in the China market.
The Company focused on actively responding to the request for AI and server products while depleting aging inventories of legacy products to further improve the inventory level and mix. Therefore, compared to the erstwhile quarter, the Company achieved crucial gross growth in HBM, DDR5 and Server SSD.
However, performance decreased due to a reduced reversal of inventory valuation failure compared to the erstwhile quarter, one-off expenses specified as the provision of incentives, and currency effects due to a weak dollar.
For the 4th quarter, the request trends experienced in the erstwhile 4th are expected to continue. The Company plans to accelerate the conversion of cutting-edge nodes in legacy lines and aims to strengthen its business fundamentals by completing the normalization of the inventory level and mix by the end of the year.
For DRAM, the Company plans to grow sales in line with the increase in HBM capacity, accelerate the transition to 1b nanometer for server DDR5 and actively grow the sales condition of high-density modules based on 32 Gb DDR5. For NAND, the Company will grow sales of 8th generation (V8) based PCIe Gen 5 and plans to mass-produce the 64 TB product for the quad-level cell (QLC) market, which has advanced growth potential.
Looking ahead to 2025, datacenter and enterprise investments are likely to stay strong in association with AI, and build request for conventional servers, in addition to AI servers, is expected to be steadily strong.
For DRAM, the Company plans to grow the sales of HBM3E and the condition of high-end products specified as DDR5 modules with 128 GB density or higher for servers and LPDDR5X for mobile, PC, servers, and so on. For NAND, the Company will proactively respond to the high-density trend based on QLC products – including 64 TB and 128 TB SSDs – and solidify leadership in the PCIe Gen 5 marketplace by accelerating the tech migration from V6 to V8.
The strategy LSI Business posted modest sales growth, but earnings declined due to increased one-off costs. System-on-chip (SoC) shipments increased as flagship products were adopted for fresh models by a major customer. Sales of image sensors were affected by H1’s inventory accumulation, resulting in any adjustments, while display driver IC (DDI) sales expanded with fresh model launches by key customers.
In the 4th quarter, supply of the Exynos 2400 will proceed to grow with higher client adoption, but weak request for image sensors is expected to continue. For DDIs, the strategy LSI Business is focusing on growth areas, specified as the expansion of IT-oriented OLED products.
Looking ahead to 2025, the momentum of on-device AI is expected to stay strong, and the Company will focus on capturing opportunities in areas specified as SoCs and cameras. The strategy LSI Business plans to concentrate on supplying SoCs for flagship products of a major client while preparing for next-generation 2 nm products. Image sensors will aim to maximize fresh product supply through HDR, low-power and zoom features, while DDIs will search to make low-power products utilizing advanced processes.
The Foundry Business saw its overall earnings decline compared to the erstwhile 4th due to the impact of one-off costs. Still, the Foundry Business successfully met its order targets – peculiarly in sub-5 nm technologies – and released the 2 nm GAA process plan kit (PDK), enabling customers to proceed with their product designs.
While mobile and PC request may stay weak in the 4th quarter, advanced performance computing (HPC) and AI-related request will proceed to be robust. The Foundry Business will strive to get customers by improving the process maturity of its 2 nm GAA technology, and it will proceed to make competitive technology and plan infrastructure to grow additional business opportunities.
For 2025, the overall foundry marketplace is expected to show double-digit growth, driven by HPC and AI applications in advanced technology nodes. The Foundry Business aims to grow gross through ongoing yield improvements in advanced technology while securing major customers through successful 2 nm mass production. In addition, integrating advanced process nodes and packaging solutions to further make the HBM buffer die is expected to aid get fresh customers in the AI and HPC sectors.
Mobile Display Records Solid Results; Will keep Leadership in the High-End Market
SDC posted KRW 8.0 trillion in consolidated gross and KRW 1.51 trillion in operating profit for the 3rd quarter.
For the mobile display business, SDC achieved sequential improvements in both sales and profits thanks to the flagship product launches of major customers. For the large display business, SDC reported a slight weakening in operating profit, but sales volume improved from the erstwhile quarter, driven by the unchangeable request of tv and monitor products.
In the 4th quarter, SDC expects continued request for flagship products from major customers, and sales growth of IT and automotive products. However, SDC’s performance outlook is rather conservative compared to the erstwhile quarter, due to headwinds from rising competition among panel makers.
For the large display business, SDC will keep striving to grow sales by gathering the 4th fourth request of major customers through improved production efficiency, and it aims to respond to the request for fresh products in 2025 with timely supply.
In 2025, SDC will proceed to keep its leadership in the foldable and high-end smartphone markets, based on innovative OLED technologies optimized for AI devices and accelerate the expansion of IT and automotive products to further diversify its business portfolio.
For the large display business, SDC will proceed to leverage the performance advantage of QD-OLED panels to strengthen its position in the premium tv market. And for monitors, SDC will broaden its lineup by adding high-resolution products and diverse refresh rate options, aiming not only to solidify its competitive edge in the gaming monitor marketplace but besides to actively enter the B2C monitor market.
MX Business To accomplish Double-Digit yearly Sales Growth in Flagships
The MX and Networks businesses posted KRW 30.52 trillion in consolidated gross and KRW 2.82 trillion in operating profit for the 3rd quarter.
Overall marketplace request for smartphones grew modestly as the residual effects of global inflation slowed the recovery in consumer spending.
The MX Business recorded sequential growth in both gross and operating profit, bolstered by the launch of fresh smartphone, tablet and wearable products. Sales increased – with a focus on flagship models – and profitability neared double digits, despite rising material costs as product specifications improved to boost competitiveness.
In the 4th quarter, seasonal factors are expected to lead to sequential growth in the smartphone market. At the same time, competition in the mass marketplace section is expected to increase as a consequence of rising demand, peculiarly in emerging markets.
The MX Business will proceed to keep solid sales of its AI smartphones, specified as foldables and the S24 series, with various sales promotions in anticipation of the vacation season, aiming for yearly flagship sales growth of double digits. In addition, the MX Business will grow sales linked to year-end seasonality for tablets and wearables, especially on fresh premium products with importantly enhanced performance, to contribute to the MX Business’ sales and profits.
In 2025, the macroeconomic environment is expected to stabilize to a degree as a consequence of interest rate cuts, leading to slight growth in the smartphone market. The mass marketplace section is expected to grow, along with request for ecosystem products, and the smartwatch and actual wireless stereo (TWS) markets will grow with broader applications of AI capabilities.
The MX Business will drive sales growth and improve profitability with a focus on flagship products, including smartphones, foldables, tablets and wearables, based on further advancements of Galaxy AI.
Visual Display To Focus on Premium Models and Service Expansion
The Visual Display and Digital Appliances businesses posted KRW 14.14 trillion in consolidated gross and KRW 0.53 trillion in operating profit in the 3rd quarter.
The Visual Display Business saw improved profitability both from the erstwhile 4th and a year earlier by prioritizing sales of strategical products specified as Neo QLEDs, OLEDs, and large TVs. Additionally, service business sales increased.
In the 4th quarter, overall request in the tv marketplace is expected to recover due to year-end highest seasonality amid intensifying competition. The Visual Display Business plans to capture highest period request by enhancing sales programs through strategical collaborations with major retail partners, and will focus on expanding sales and securing profitability by emphasizing the competitiveness of TVs in terms of security, design, and content.
In 2025, the overall tv marketplace is expected to post modest growth, with strategical products like QLEDs, OLEDs, and large TVs continuing to gain marketplace share. To solidify its leading position globally, the Visual Display Business will proceed to differentiate AI functionalities and innovate its products centering on premium and Lifestyle screens.
By utilizing AI, the Company aims to enhance core tv features specified as image and sound quality, while besides improving the overall user experience within the SmartThings ecosystem. The Company plans to drive sales of premium products centered on Neo QLED, OLED and super large TVs, and it will keep leadership in the Lifestyle screen category by leveraging well-established competitive advantages.
Furthermore, by capitalizing on the extended installed base that has been established through hardware leadership, the Visual Display Business will proceed to grow the service platform business through advertisement and media specified as Samsung tv Plus.
