Samsung flags 10-fold rise in first-quarter profit as chip prices recover
Samsung Electronics estimated on Friday a more than 10-fold rise in its first-quarter operating profit, as rebounding semiconductor prices lifted earnings from a low base a year ago when there was a severe downturn in chip demand.
The world's largest memory chip and TV maker estimated its operating profit rose to a better-than-expected 6.6 trillion won ($4.89 billion) in the quarter ended March 31.
That was up 931% from 640 billion won a year earlier, the South Korean firm said in a short preliminary earnings statement, and would be Samsung's highest operating profit since the third quarter of 2022.
The operating profit estimate beat a 5.7 trillion won LSEG SmartEstimate, which is weighted toward forecasts from analysts who are more consistently accurate.
But revenue missed expectations, likely rising 11% from the same period a year earlier to 71 trillion won, below a LSEG SmartEstimate of 72.3 trillion won.
«Since revenue was mostly in line but operating profit beat expectations, the inventory valuation of NAND flash chips may have improved. Demand for NAND has improved, which may have improved margins as well,» said Park Sung-soon, an analyst at Korea Investor Relations Service.
«Initial response to new Galaxy S24 smartphones was also positive due to on-device AI, so if greater-than-expected portion of the high-margin premium smartphones were sold, it would have an impact.»
The company is due to release detailed earnings on April 30.
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