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The Korea Herald
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THE INVESTOR
March 29, 2024

Samsung

Samsung narrows profitability gap with Apple

  • PUBLISHED :May 03, 2018 - 09:25
  • UPDATED :May 03, 2018 - 09:26
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[THE INVESTOR] Samsung Electronics has narrowed the profitability gap with archrival Apple in the first three months of this year, industry data showed on May 3.

Apple posted an operating profit of US$15.8 billion and sales of US$61.1 billion in the first quarter, with its operating profit-to-sales ratio standing at 26 percent, the latest findings showed. It marked a slight drop from 26.7 percent posted a year earlier.

Over the same period, Samsung posted an operating profit of 15.6 trillion won (US$14.4 billion), along with sales of 60.5 trillion won, posting a comparable ratio of 25.8 percent.

Considering Apple was more than 10 percentage points ahead in the profit-to-sale ratio in 2016, industry watchers said the latest numbers indicate the Korean tech giant has successfully improved its profit margins and is even gaining on the Cupertino-based company.

Tech observers said Samsung may also outpace Apple in the second quarter, as the US tech giant normally posts weaker earnings in the April-June period.

The direct comparison between Samsung and Apple, meanwhile, does not reflect the overall business conditions of the two considering the Korean company posts most earnings from the chip segment, sources added.

“If Samsung wishes to maintain its profitability down the road, it needs to secure growth engines for respective business segments,” an industry insider said.

By Song Seung-hyun and newswires (ssh@heraldcorp.com)

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