Corporate sales in Korea, which fell in the second quarter of this year, returned to growth after one quarter. Strong performance in electric and electronics, including semiconductors, buoyed by expanded investment in artificial intelligence (AI), led the overall improvement.
According to the Corporate Management Analysis for the third quarter of 2025 released by the Bank of Korea on the 17th, sales of 4,233 corporations among 26,067 external-audit corporations—those surveyed—rose 2.1% from a year earlier in the third quarter. Corporate sales fell 0.7% in the second quarter, when uncertainty over U.S. tariff widened, marking the first drop since the fourth quarter of 2023, but rebounded after one quarter.
Manufacturing sales turned from a 1.7% decline in the second quarter to a 2.9% increase in the third quarter, driving overall sales growth. The nonmanufacturing sales growth rate also expanded from 0.3% to 1.2%. By industry, machinery and electric and electronics (8.9%), information and communications (8.8%), and wholesale and retail (4.0%) posted notable gains. Electric and electronics benefited from strong exports of high-bandwidth memory (HBM) driven by expanded global AI investment, while wholesale and retail reflected increased sales at some large e-commerce companies.
The sales growth rate is an indicator that divides current-period sales by sales in the same period a year earlier, showing the growth potential of corporations. A Bank of Korea (BOK) official said, "Improved performance in machinery and electric and electronics, including semiconductors, had the biggest impact on the increase in sales," and added, "Steel and autos were negatively affected by U.S. tariff by item, but semiconductor-centered growth offset it."
Profitability for corporations also improved. The operating margin on sales of external-audit corporations in the third quarter was 6.1%, up from 5.8% a year earlier. The operating margin on sales refers to the share of operating profit in a corporation's total sales and is an indicator of profitability. An operating margin on sales of 6.1% means that out of 100 won in revenue, 6.1 won remained as profit.
By industry, the operating margin on sales for manufacturing rose sharply to 7.1% in the third quarter from 6.1% a year earlier. In contrast, nonmanufacturing slowed to 5.1% from 5.4%. Manufacturing saw improved profitability centered on machinery and electric and electronics, while nonmanufacturing was affected by weakness in transportation.
Financial soundness indicators also showed an improving trend. The debt ratio in the third quarter was 88.8%, down 1.0 percentage point from the previous quarter (89.8%). This is 1.3 percentage points lower than the average (89.5%) since the first quarter of 2015. The dependence on borrowing fund fell to 26.2% in the third quarter from 26.6% in the second quarter, but it remained higher than the past average (24.5%).
The debt ratio is calculated by dividing a corporation's total liability by its equity, showing how much debt it has relative to capital. Dependence on borrowing fund is the amount of borrowing fund and corporate bonds combined divided by total capital. These two indicators are used as key criteria for assessing a corporation's financial soundness.