Record performance of memory chips and growing demand for flexible displays more than compensated for the major setback for the world’s largest smartphone maker from the discontinuation of Galaxy Note7, sending Samsung Electronics to finish the year of 2016 with the second-best-ever performance.

Weaker won against the U.S. dollar further aided competitiveness of its components on top of reduced production cost, Samsung Electronic said Tuesday in releasing final fourth-quarter earnings and predicted profit will likely be reduced in the first quarter from the stellar performance of the previous three-month period due to increased marketing cost for the new flagship smartphone.

Samsung Electronics Co. confirmed Tuesday that its operating profit in the fourth quarter reached 9.22 trillion won ($7.92 billion), up 77.3 percent from the previous quarter and 50.1 percent from the same period a year-ago. Sales totaled 53.33 trillion won, up 12 percent on quarter and 0.03 percent on year.

At 1:15 p.m. Tuesday in Seoul trading, shares of Samsung Electronics were up 1,000 won at 1,904,000 won.

From the semiconductor division, it raised record-high profit of 4.95 trillion won in the fourth quarter thanks to a recovery in memory chips for PCs backed by its lucrative production mix of high-performance dynamic random memory chips and NAND flash memory amid growing demand for higher-capacity memory in smartphones and applications in Internet of Things. Memory chip sales jumped 39 percent on year and 18 percent on quarter in the fourth quarter to reach 11.62 trillion won.

Growing demand for organic light-emitting diode (OLED) display as the option for flexible devices, computing home appliances, and smartphones bumped up sales in panels by 14 percent on year and 5 percent on quarter to 7.42 trillion won. Operating profit also gained 346.7 percent on year and 31.4 percent on quarter to 1.34 trillion won.

Despite global-wide recall and discontinuation of Galaxy Note7 that the company estimated a loss of more than $5 billion, mobile division kept up an operating profit of 2.5 trillion won in the fourth quarter, up 12.1 percent on year, on sales of 23.61 trillion won thanks to steady sales of Galaxy S7 series.

For full-year 2016, the company registered a net profit of 22.7 trillion won, up 19.23 percent from the previous year, and operating profit of 29.2 trillion won, up 10.7 percent on year. Profit was the second largest after the historic high of 36.8 trillion won in 2013. Sales grew by 0.6 percent to 201.9 trillion won.

In 2016, it spent 25.5 trillion won in facility investment, of which 13.2 trillion won went to semiconductor division and 9.8 trillion won in the display. It did not disclose investment plans for this year.

By Lee Dong-in

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