gettyimagesbank

Korean businesses experienced the sharpest growth in earnings and sales compared to their counterparts in the United States and Japan in the first half of this year, according to an analysis report, Sunday.

The Korea Enterprises Federation's (KEF) research team compared the revenues and operating profits of 44 companies from Korea, the U.S., and Japan listed on the Fortune Global 500.

The KEF selected 16 companies from each country across eight industries, but only 12 Japanese firms from six industries, as Japan lacked Fortune Global 500 companies in the semiconductor and internet service sectors. The eight industries included are semiconductor, steelmaking, automobile, retail, bio and pharmaceuticals, refining, communications, and internet service.

Among the firms analyzed, Korean companies led with an average revenue growth of 17.1 percent in the first half of this year, followed by U.S. companies at 14.6 percent and Japanese companies at 7.1 percent.

U.S. firms posted the highest average operating profit margin of 18.5 percent, followed by Korea at 9.5 percent and Japan at 7.5 percent.

Even when excluding the semiconductor and internet service sectors, where Japan has no comparable companies, Korea had the highest average revenue growth rate of 8.9 percent.

In a breakdown by countries and industries, semiconductor firms in Korea showed the highest revenue growth of 75.4 percent, followed by bio and pharmaceutical firms with 38.1 percent.

Among U.S. firms, semiconductor companies reported an average revenue growth of 87.3 percent, while internet service firms saw 19.5 percent growth. In Japan, the automobile industry led with a 16.7 percent increase in revenues.

In particular, chipmakers in Korea and the U.S. showed significant year-on-year revenue growth in the first half, with Samsung Electronics posting 18 percent, SK Hynix 132.8 percent, Nvidia 171 percent and Intel 3.6 percent.

While SK Hynix and Nvidia have surpassed their revenue figures from the first half of 2022, when the industry was in an upcycle, Samsung Electronics and Intel have not yet recovered to those levels, according to the KEF report.

In all three countries, steelmaking firms showed the slowest revenue growth. In the first half of this year, sales at Korean and U.S. steel firms declined by 9.4 percent and 11.9 percent year-on-year, respectively. Meanwhile, Japanese steelmakers reported an average revenue growth of 0.5 percent during the same period.

“In the first half of 2024, the growth of Korean companies, particularly in the semiconductor and bio and pharmaceutical sectors, was notably higher compared to those in the U.S. and Japan,” an official at the KEF said.

“To ensure sustainable growth amid prolonged high interest rates, low growth trends, and global uncertainties such as the Russia-Ukraine conflict and Middle East tensions, it is essential to create an environment that enables companies to expand investments through tax support and deregulation to the extent of competing nations.”