Harman had a rocky start under Samsung's leadership following the 2017 merger. Industry watchers initially expected Harman to become Samsung's new healthy revenue stream in record time, but that didn't happen.
After a few years of poor performance on Harman's part, those high expectations turned into disappointment, and industry watchers began doubting Samsung's strategy. They wondered if Samsung made a mistake when it agreed to acquire Harman.
Fast forward to 2024, and Samsung has finally proven doubters wrong about its long-term strategy. There is no doubt about it, considering Harman's performance over the past few years.
Harman posted a record-high operating profit in 2024
Despite its initial losses, Harman managed to improve its position on the market and increase its operating profit in recent years. Here is a quick breakdown.
In 2021, Harman posted an operating profit of 559 billion won ($383 million). A year later, in 2022, the company increased its operating profit to 880 billion won ($603 million).
This upward trend continued year-on-year, and in 2023, Harman's operating profit rose to 1.17 trillion won ($802 million).
Finally, last year, Harman recorded an operating profit of 1.3 trillion won ($891 million) and set a new record since its merger with Samsung nearly a decade ago.
According to reports (via KED Global), Harman even beat Samsung's TV and home appliance divisions in the fourth quarter of 2024 and recorded twice as much profit. Harman achieved a profit of 400 billion won ($274 million) over the three-month period.
Industry watchers attribute this success to a few factors. One is Samsung's clever strategy to aim the JBL brand at millennials and Gen Z customers in the USA. Samsung started selling JBL audio products straight from its e-shop last year.
JBL audio is now available at Samsung
Harman International owns more than a dozen audio brands, from JBL and AKG to Harman Kardon and Mark Levinson.
Another reason behind Harman's recent success is the rise of the audio and automotive electronics segments.
Thanks to a closer partnership with Samsung and easy access to the Korean tech giant's advanced in-vehicle tech, Harman was able to close more deals for digital cockpit solutions and infotainment systems with brands such as Toyota, BMW, and even Ferrari for road car and F1 solutions.
With the automotive electronics market expected to keep gaining traction by 2030, Harman and Samsung are likely to gain even more from their partnership.
