Harman’s Acquisition by Samsung: A Success Story Years in the Making

Harman International, famous for its 12+ iconic audio brands, was purchased by Samsung in 2017 for a staggering $8 billion. This remains Samsung’s most expensive acquisition to date, as the company hasn’t made any major purchases since. Despite initial skepticism and some rocky moments, Harman has now become a major growth driver for Samsung, proving its worth over time.

Harman is Thriving Under Samsung’s Leadership

When Samsung first acquired Harman, the results were underwhelming. The lack of synergy between Harman and the rest of Samsung’s operations raised eyebrows, with many industry experts questioning the move. Fast forward to today, and the tables have turned. Harman’s profitability has skyrocketed, and its innovative products—developed in collaboration with Samsung—are now market leaders.

Harman reported $902 million in operating profit last year, the highest since the acquisition. In the fourth quarter of 2024, Harman’s profit outpaced Samsung’s TV and home appliance divisions, more than doubling their performance.

Key to Harman’s success has been its innovations in home audio systems and connected car technology. Its systems are now installed in over 50 million vehicles, and partnerships with automotive giants like BMW and Ferrari have further solidified its position in the market. Collaboration between Harman and Samsung’s internal teams on in-vehicle tech, such as digital cockpits, has also yielded significant wins for both companies.

A Strategic Move by Samsung

The acquisition of Harman marked Samsung’s first major deal under the leadership of Jay Y. Lee, who was a member of the company’s board at the time. Although no longer on the board, many believe Lee’s return could steer Samsung toward more bold acquisitions. With over $100 billion in cash reserves, Samsung is well-positioned to make significant moves in the future.

Harman’s journey from a challenging start to becoming a key profit generator highlights the long-term vision behind Samsung’s strategy. As the partnership continues to grow, it’s clear that this acquisition has turned into a resounding success.

Via

Source