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Watch Samsung

April 28th, 2003 · No Comments

NYTimes writes about South Korea’s leading company, Samsung:

Since 1996, Samsung has been run by Yun Jong Yong, a soft-spoken engineer who seems to believe that a good dose of crisis and chaos will keep Samsung, South Korea’s No. 1 company, agile and resourceful, fighting as if it were No. 3 when in many areas it has in fact become No. 1. And in many ways, Samsung’s success is emblematic of Korea’s rapid entry into the club of developed nations.

From a mass producer of cheap electronics a decade ago, Samsung is now the world’s largest producer of memory chips and flat screens. Its market capitalization is now bigger than its Japanese rival, Sony. Last year, Samsung was the world’s third-most-profitable electronics company, after General Electric and Microsoft.

Sony’s sales volume still dwarfs Samsung’s, but Sony’s profitability is far lower. During the first quarter of this year, Samsung Electronics earned $942 million in net profit on $8 billion in sales. By comparison, Sony earned a similar amount, $963 million for the full fiscal year ended March 31, but that was on $62.3 billion in sales. On Thursday, Sony announced a profit on sales of 1.5 percent for the fiscal year, compared with 17.5 percent for Samsung last year.

Niche products like graphics chips for game consoles and flash-memory chips for cellphones and hand-held computers have helped Samsung make money in an industry plagued by overcapacity and declining demand.

Tags: Emerging Markets

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