SEOUL, Jul. 28 (Korea Bizwire) — Samsung Electronics Co. emerged as the world’s No. 1 chipmaker in terms of sales and operating profits in the second quarter, beating behemoth Intel Corp. market data showed Friday.
The rise of Samsung is significant as Intel has been standing as the leading computer chip producer for some 24 years.
Industry watchers said the rise is the result of the South Korean tech giant’s successful developed next-generation technologies for dynamic random-access memory (DRAM) chips and NAND flash memory and quickly responded to changing market needs.
On Thursday, Samsung Electronics said its chip business posted an operating profit of 8.03 trillion won (US$7.1 billion) in the second quarter, soaring from 2.64 trillion won posted a year earlier, on the back of the rising demand for server DRAMs and SSD products. Overall sales were estimated at 17 trillion won.
It marked the first time for the chip business to post an operating profit exceeding the 8 trillion-won mark.
Intel, on the other hand, said it posted sales of $14.8 billion and operating profit of $3.8 billion for the April-June period.
The U.S. company’s operating profit marked a whopping 190 percent on-year growth, although this still lagged far behind those of Samsung.
Samsung posted an operating profit ratio to sales of 45.7 percent, easily outpacing the 25.7 percent posted by Intel.
The boom of the mobile industry, which led to the rising demand for DRAM chips and solid state drives (SSDs) helped Samsung post the sharp growth, industry watchers added. An SSD is a data storage device made with a NAND flash memory chip that does not need power to store data and is more durable and faster than a hard disk drive.
Intel, on the other hand, focuses on the production of central processing units.
The South Korean tech company is anticipated to beat Intel also in terms of annual performance as the global chip industry’s outlook remains rosy over the second half, industry watchers here said.
The boom of the cloud computing, virtual reality and self-driving automobile industries is also expected to lend support to Samsung’s strong position going forward, they added.