Samsung Electronics fully repaid the 20 trillion won it borrowed from Samsung Display during the semiconductor downturn in 2023. As demand for artificial intelligence (AI) expanded and memory business results improved significantly, cash and short-term financial products on a consolidation basis increased by more than 64 trillion won from the end of last year to nearly 190 trillion won.
According to the semiannual report disclosed by Samsung Electronics on the 18th, Samsung Electronics repaid all 20 trillion won in borrowing fund borrowed from Samsung Display in the first half of this year. On the separate financial statements, 20 trillion won in unsecured borrowing fund from Samsung Display remained at the end of last year, but the balance fell to 0 won at the end of June this year. The semiannual report specified that 20 trillion won in subsidiary borrowing fund was repaid during the first half.
Samsung Electronics borrowed 20 trillion won from Samsung Display in 2023, when memory market conditions deteriorated sharply. At the time, the Samsung Electronics device solutions (DS·semiconductor) institutional sector recorded an annual operating loss in the 14 trillion won range. To secure the liquidity needed to continue large-scale semiconductor investments, it raised funds from Samsung Display.
The situation changed this year. Samsung Electronics' DS division posted 142.8593 trillion won in operating profit in the first half, accounting for 97.4% of Samsung Electronics' total operating profit. The DS division also recorded 209.2317 trillion won in sales. In the semiannual report, Samsung Electronics said the average selling price (ASP) of memory in the first half of this year rose about 220% from last year's annual average.
Cash capacity also increased significantly. Cash and cash equivalents on a consolidation basis rose from 57.8564 trillion won at the end of last year to 92.9164 trillion won at the end of June this year. Short-term financial products increased from 67.965 trillion won to 97.0366 trillion won over the same period. The combined amount of the two items rose from 125.8214 trillion won to 189.953 trillion won, an increase of about 64.13 trillion won in six months.
Long-term borrowing fund at Samsung Electronics' headquarters also fell sharply. On a separate basis, long-term borrowing fund decreased from 23.3991 trillion won at the end of last year to 4.2542 trillion won at the end of June this year. This reflects the disappearance of the 20 trillion won Samsung Display borrowing fund. As of the end of June, the remaining long-term borrowing fund consisted of 3.6 trillion won in Korea Development Bank (KDB) borrowing fund and 654.2 billion won in lease liabilities.