Samsung’s Harman Doubles Revenue in a Decade, Driven by Auto Tech and Audio

Harman, acquired by Samsung Electronics, has become a core growth engine over the past decade, anchored by automotive electronics and audio. Once seen as a high-stakes bet, the unit has more than doubled revenue since the acquisition and is now positioned as a key part of Samsung’s future business portfolio. 

Samsung said Tuesday that Harman posted record revenue and operating profit last year. Operating profit totaled 1.5311 trillion won, and the operating margin was 9.7%, close to 10%. 

Harman first topped 10 trillion won in annual revenue in 2019, at 10.08 trillion won. Last year, revenue rose to 15.7833 trillion won, more than double the 7.1034 trillion won recorded in 2017, shortly after Samsung took over. 

Samsung announced the Harman acquisition in November 2016 and completed the process in March 2017. The purchase price was $8 billion, about 9.4 trillion won at the time, then the largest overseas merger and acquisition by a South Korean company. Samsung described the move as a step beyond its smartphone- and home-appliance-centered structure and into automotive electronics, a key field for next-generation vehicles.

Harman is now cited as a growth pillar in Samsung’s non-chip businesses, led by automotive electronics. The company has maintained the No. 1 global position in digital cockpits and car audio as of last year, and about 65% to 70% of total revenue is said to come from the automotive segment. As in-vehicle infotainment and connected-car markets expand, Harman’s role has grown.

Samsung said collaboration has strengthened competitiveness by combining Harman’s automotive solutions with Samsung Electronics’ semiconductors, displays and 5G communications technology. Cooperation has expanded in areas such as in-car digital cockpits, advanced driver experiences and online connectivity. Samsung also said work with Harman has helped build a base to expand its Exynos Auto chips and the SmartThings platform.

In audio, Harman holds brands including JBL, AKG, Mark Levinson and Lexicon. Last year it acquired the audio business of U.S.-based Masimo for 500 billion won, adding premium brands such as Bowers & Wilkins, Denon and Marantz. Samsung said the lineup now spans products from mass-market Bluetooth speakers to ultra-high-end audio.

This year marks JBL’s 80th anniversary and the 10th anniversary of Samsung’s announcement of the Harman deal. Founded in 1946, JBL has been a major brand across venues ranging from the Woodstock festival to cinemas, concert halls and home audio. Harman grew into what Samsung called the world’s largest audio company and broadened its reach into automotive electronics after joining Samsung.

Harman has continued investing for longer-term growth. Late last year, it acquired German supplier ZF’s advanced driver-assistance systems business for 1.5 billion euros, about 2.6 trillion won. It is also making additional investments in Hungary to expand autonomous-driving research and development and production bases, aiming to strengthen sensor and camera capabilities for its automotive electronics business.

Samsung said it plans to continue research and development by combining Harman’s depth in audio technology with Samsung Electronics’ innovation capabilities so customers worldwide can enjoy high-quality sound in everyday life.