SEOUL-Samsung Electronics Co. Ltd. posted increasing revenues, but the company’s profit line took a hit due to a $300 million fine the U.S. Department of Justice levied against the company for international price fixing.
The Justice Department said the fine is the second largest antitrust fine in U.S. history. Samsung admitted it conspired with other memory chip manufacturers including Hynix Semiconductor Inc. and Infineon Technologies AG to fix prices on DRAM memory chips. The chips are primarily used in desktop computers, but also can be found in a variety of other electronics devices including mobile phones. The price-fixing scheme directly affected Dell Inc., Hewlett-Packard Co., Apple Computer Inc., IBM Corp. and Gateway Inc.
“Today’s guilty plea is evidence of the Department’s ongoing commitment to protect consumers from corporations that engage in illegal conduct,” said U.S. Attorney General Alberto Gonzales.
Samsung’s third-quarter revenue was up 1.4 percent from the same quarter a year ago, but its earnings dropped to $1.8 billion. In the company’s telecommunications division-which is largely driven by handsets-Samsung posted a 5-percent drop in revenues from the same quarter a year ago and a corresponding drop in operating profit.
However, Samsung increased its 2005 expectations for worldwide mobile phone sales from 720 million to 760 million. The company said it expects W-CDMA and CDMA EV-DO handset sales to pick up by the end of the year. Specifically, Samsung said it would release up to five new W-CDMA products by the end of the fourth quarter.
