Samsung Electronics : 2017 1Q Interim Report

For the quarter ended March 31, 2017

Certain statements in the document, other than purely historical information, including estimates, projections, statements relating to our business plans, objectives and expected operating results, and the assumptions upon which those statements are based, are "forward-looking statements." Forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties which may cause actual results to differ materially from the forward-looking statements. A detailed discussion of risks and uncertainties that could cause actual results and events to differ materially from such forward-looking statements is included in our financial reports available on our website.

See, also, 『Note on Forward-Looking Statements』in preamble of 『II. Business Overview』.

Table of Contents

Certification 3

1. Corporate Overview 4

2. Businesses Overview 28

3. Financial Affairs 68

4. Auditor's Report 148

5. Management Discussion and Analysis 150

6. Corporate Governance 151

7. Information on Shareholders 160

8. Executives and Employees 166

9. Affiliates and Subsidiaries 170

10. Related Party Transactions 200

11. Other Information 204

    Certification

    Letter of Certification

    We, Oh-Hyun Kwon and Sang-Hoon Lee, as CEO and executive of the company in charge of reporting, certify that we have reviewed the interim business report of Samsung Electronics Co., Ltd. for the quarter ended March 31, 2017.

    Based on our knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary that would be misleading with respect to the period covered by this report.

    Based on our knowledge, the financial statements, and other financial information included in the report, fairly present in all materials respects the financial condition, results of operations and cash flows of the company as of, and for, the periods presented in this report.

    We confirm that Samsung Electronics operates an Internal Accounting Management System, responsible for establishing and maintaining disclosure controls and procedures and internal controls over financial reporting, as defined in Article 2.2 and 2.3 of the External Audit Act. We have disclosed our most recent evaluation of internal controls over financial reporting to the Company's auditors and to the audit committee of the Company's board of directors.

    Date: 2017. 5. 15

12. Corporate Overview
13. Overview

14. Legal, Commercial Name:

    • Samsung Electronics Co., Ltd.

15. Date of Establishment:

    • Samsung Electronics Co., Ltd. ("SEC") was established as Samsung Electronics Industry Co., Ltd. on January 13, 1969, and held an initial public offering on June 11, 1975.

    • SEC changed its name from Samsung Electronics Industry Co., Ltd. to Samsung Electronics Co., Ltd. following a resolution passed at the Annual General Meeting of Shareholders on February 28, 1984.

16. Address, Phone Number, and English Language Website of the Corporate Headquarter

    • Address: 129, Samsung-ro, Yeongtong-gu, Suwon, Gyeonggi-do, Republic of Korea

      - Phone Number: 82-31-200-1114

    • Website: http://www.samsung.com/sec

17. The Company does not fall under the category of small and medium enterprise under Article 2 of the Framework Act on Small and Medium Enterprises.

18. Core Businesses

    • The Company (defined below) separately oversees three independent self-determining divisions (each a "Division"), CE (Consumer Electronics), IM (Information Technology & Mobile Communications), and DS (Device Solutions).

19. Products in each Division are presented below:

    Division	Products
    CE	TV, Monitor, Refrigerator, Washing Machine, Air Conditioner, Medical Devices, etc.
    IM	HHP, Network System, Computer, etc.
    DS	DRAM, NAND Flash, Mobile AP, LCD panel, OLED panel, etc.

    The Company is a global electronics company comprised of the headquarters in Korea and 279 subsidiaries (SEC and its subsidiaries collectively, "Samsung Electronics" or the "Company") across the world including nine (9) regional headquarters for the CE and IM Divisions and five (5) regional headquarters for the DS Division.

    [CE Division]

    The CE Division is leading the global digital era by continuously offering new products with innovative technology, unique design, and enhanced value propositions.

    TV is the core product of CE. The Company has maintained its market leadership position for the past eleven (11) consecutive years in 2016 by leveraging competitive advantages in hardware such as LCD/LED TVs as well as software driven product features within our Smart TV product portfolio.