Despite a year of scandal, Samsung has just recorded is highest quarterly profits ever. Driving Samsung’s profits are sales of new chips and screens, even to competitors like Apple. Timothy W. Martin and MinJung Kim report:
America knows Samsung by its consumer brands. But the company owes its fortunes to its less visible but increasingly dominant position in the memory chips and screens from which smartphones are built. Its dominance in those components is so pronounced that rivals like Apple have few other places to turn. Components now represent about 70% of the company’s overall profits.
“Everywhere in tech, you touch Samsung,” says Randy Abrams, a Taiwan-based analyst for Credit Suisse.
Memory chips aren’t sexy. But an explosion in internet-connected devices from self-driving cars to light bulbs to refrigerators has fueled demand for semiconductors, the brains and memory of electronic devices. Samsung has a dominant market share, notably for the DRAM chips that power smartphones.
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