finance

Samsung Electronics flags 53% jump in Q2 profit, topping estimates



© Reuters. FILE PHOTO: The logo of Samsung Electronics is seen at its office building in Seoul, South Korea South Korea, October 11, 2017. REUTERS/Kim Hong-Ji/File Photo

By Joyce Lee and Heekyong Yang

SEOUL (Reuters) -Samsung Electronics Co Ltd said on Wednesday its second-quarter operating profit likely jumped 53%, beating analysts’ estimates, as strong chip prices and demand lifted earnings.

The world’s largest memory chip and smartphone maker said profit for the quarter ended June 30 was likely 12.5 trillion won ($11 billion), above a Refinitiv SmartEstimate of 11.3 trillion won ($10 billion) drawn from 20 analysts.

Revenue rose an estimated 19% from the same period a year earlier to 63 trillion won, Samsung (LON:) said in a short preliminary earnings release.

Profits at Samsung’s chip division likely jumped by a fifth or more from a year earlier, analysts said, helped by strong memory-chip prices and demand for consumer electronics and from data centre customers.

Prices of DRAM chips, widely used in servers, mobile phones and other computing devices, jumped 27% compared with the March quarter, while those of NAND flash chips that serve the data storage market rose 8.6%, according to research provider Trendforce.

Samsung’s memory chip shipments were also larger than expected, contributing to chip profits that dwarfed a quarter-over-quarter decline in smartphone shipments, analysts said.

Profits at its chip contract manufacturing and logic chip design businesses were likely to have improved too as operations at a storm-hit factory in Texas returned to normal, analysts said.

Last month, U.S. memory chip rival Micron Technology Inc (NASDAQ:) reported a quarterly profit that beat Wall Street estimates, and forecast current-quarter revenue above expectations.

See also  FAA let Boeing 737 Max continue to fly even as review found serious crash risk

Samsung’s smartphone shipments fell to about 59 million in April-June from about 76 million in the first quarter, according to Shinyoung Investment & Securities, as sales of its flagship model launched in the first quarter slowed.

New COVID-19 outbreaks in regions such as India and Vietnam, as well as constrained supply of mobile processor chips, also hurt smartphone shipments, analysts said.

Samsung shares have traded nearly flat so far this year versus a 15% rise in the wider market.

Samsung released only limited data in Wednesday’s regulatory filing ahead of the release of detailed earnings figures later this month.

($1 = 1,136.7800 won)

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.





READ SOURCE

Leave a Reply

This website uses cookies. By continuing to use this site, you accept our use of cookies.  Learn more