Samsung Electronics will announce its preliminary operating results for the third quarter of this year on October 8. In FnGuide’s October 4 compilation, the average estimates from securities firms, based on consolidated financial statements, were about 200.7 trillion won in revenue and about 106.9 trillion won in operating profit. If those estimates prove accurate, Samsung Electronics will post quarterly operating profit of more than 100 trillion won for the first time. But these are estimates made before the announcement, so they should be distinguished from the actual results.
Background and context
If the estimate is realized, third-quarter operating profit would be up 19.4% from 89.5 trillion won in the second quarter of this year. Compared with 12.2 trillion won in the same period last year, it would be nearly nine times higher. Securities analysts expect operating profit to have risen 56% in the second quarter from the previous quarter, while the increase in the third quarter is forecast at about 20%. In other words, profits are expected to grow substantially, but at a slower pace than in the previous quarter.
The outlook for supply and demand in the semiconductor market is cited as a factor supporting expectations for results. U.S. company Micron reported record quarterly and annual results and forecast that memory supply and demand in 2027–2028 would be much tighter than this year. Micron said it had contracted most of its 2027 supply of high-bandwidth memory (HBM, a type of high-performance memory) at prices higher than the previous year’s, and that the number of its long-term supply agreements, known as strategic customer agreements, had increased from 16 to 26. This points to optimism about market conditions, but the information alone cannot establish Samsung Electronics’ actual results or future profits.
There are also factors that could lower the earnings estimate. When the won strengthens, export companies may face pressure on profits denominated in won because revenue earned in dollars converts into fewer won. Reports said some securities firms had lowered their forecasts for Samsung Electronics for this reason. IBK Investment & Securities forecast a third-quarter operating margin of 52.1%, down 0.1 percentage point from the previous quarter, and cited the won-dollar exchange rate and the inclusion in the third quarter of some bonuses that were not paid in the second quarter as factors to watch.
What this means
This outlook is about more than just “how much did the company earn?” The larger the profits, the more important it may become for employees and the company to discuss the criteria for calculating bonuses and how they are allocated among divisions. On October 6, Choi Seung-ho, chair of the Samsung Electronics branch of the Samsung Group Cross-Company Union (삼성그룹 초기업노조 삼성전자지부), is scheduled to appear as a witness at the National Assembly’s Trade, Industry, Energy, SMEs and Startups Committee (국회 산업통상자원중소벤처기업위원회) audit of state affairs. The criteria for calculating and distributing bonuses are expected to be among the issues raised.
Samsung Electronics is expected to disclose the detailed criteria around October 7 for the newly established special management performance bonus for its semiconductor (DS) division (반도체(DS) 부문 특별경영성과급), agreed upon in wage negotiations. The Donghaeng Union (동행노조), a labor union centered on the mobile and consumer electronics (DX) division, is calling for joint bargaining. Therefore, the high earnings estimate alone does not reveal how much individual employees will receive or how bonuses will be allocated; the criteria to be disclosed and the bargaining process may determine the specific points of contention.
For shareholders, the amount of the cash dividend is a key concern. Samsung Electronics plans to finalize a cash dividend of about 30 trillion won at a board meeting at the end of this month. The earnings outlook and the company’s shareholder-return plans are both drawing attention, but the exact amount to be approved by the board is not yet known. For example, an investor who owns Samsung Electronics shares will need to check the dividend amount approved by the board and the actual earnings announcement separately, rather than relying on the estimate alone.
What is confirmed and what is still unknown
Confirmed facts
- Samsung Electronics is scheduled to announce preliminary third-quarter operating results on October 8.
- FnGuide’s October 4 compilation put the estimates at about 200.7 trillion won in revenue and about 106.9 trillion won in operating profit. These are the average estimates from securities firms.
- IBK Investment & Securities forecast a third-quarter operating margin of 52.1%, down 0.1 percentage point from the previous quarter.
- At the October 6 National Assembly audit of state affairs, questions are expected on how bonuses are calculated and distributed. Samsung Electronics is expected to disclose the detailed criteria for the DS division’s special management performance bonus around October 7.
- Samsung Electronics plans to finalize a cash dividend of about 30 trillion won at a board meeting at the end of this month.
Still unknown
- What will Samsung Electronics’ actual third-quarter revenue and operating profit be?
- How will the detailed criteria and allocation method for the DS division’s special management performance bonus be set?
- What exact amount will the board approve for the cash dividend?
What readers should check
- Check how the actual revenue and operating profit announced on October 8 compare with the estimates.
- Review the criteria for the DS division’s special management performance bonus expected around October 7, as well as the issues raised about bonus calculations and allocation at the National Assembly audit of state affairs.
- Shareholders should check the cash dividend amount approved by the board at the end of this month separately from the estimate.
