Samsung Electronics expects record quarterly earnings
Samsung Electronics expects record quarterly earnings
SEOUL: Samsung Electronics Co. expects operating profit for the third quarter to be the highest in its history, surpassing analysts' estimates, as demand for its electronic components remains high.
The world's largest maker of smartphones and semiconductors said on Friday it expected an operating profit of 17.5 trillion South Korean won ($ 15.4 trillion) for the quarter, 20% more than the 14.53 trillion won the year before. Samsung expects revenues to rise to 65 trillion won from 62 trillion won.
Analysts polled by S & P Global Market Intelligence expected the company to post an operating profit of 17.1 trillion won and income of 65.1 trillion won for the quarter ended September 30. Samsung reports the final results later this month.
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The previous one of the company. record operating profit it is 15.64 trillion won, established during the first three months of the year.
But investors worry about how long Samsung can take advantage of memory chips and if the company Recent slide in smart phone sales it will reverse itself. Shares of Samsung Electronics have fallen 22% since last November, when demand for memory and the growth of devices seemed more secure.
Analysts expect shipments weaker than expected for Samsung's flagship devices, the Galaxy S9 and the Galaxy Note 9, which hit the shelves in August. In its second quarter, the operating profit of Samsung's mobile unit sank by a third from the previous year. Executives have said they were too cautious when adopting aggressive new features.
Samsung is battling phone rivals on two fronts. Keep competing with Apple Inc.'s iPhone for the world's richest consumers of high-end devices priced at $ 1,000 or more. But he is also involved in a battle for cheap phones with Chinese rivals that offer similar features at lower prices, challenging the South Korean firm's dominance in markets such as India.
Samsung's smartphone shipments plummeted to 71.5 million units in the quarter ended June, a 10% drop from the previous year, according to Strategy Analytics, a market researcher. Maintaining high volumes is essential for Samsung, as it gives the company the bargaining power to keep component prices low with suppliers, even more critical now that smart phone growth is shrinking as smartphones grow. Consumers keep their phones longer.
The company based in Suwon, South Korea, has relied on memory chips to compensate for mobile losses. But memory prices "are tracking worse than expected," Susquehanna analyst Mehdi Hosseini said in a research note last month, where Samsung Electronics' target price fell.
The prices of NAND flash memory, which is used to store content on devices, are expected to fall by 10% to 15% during the last six months of 2018 compared to previous quarters, Mr. Hosseini said. The prices of DRAM, a chip that grants multitasking speed to devices, are expected to decrease from 3% to 5% in the last three months of 2018, compared to the previous quarter, while the first half of 2019 could record falls. of two digits. additional. Samsung is the largest manufacturer of NAND and DRAM.
The prices of the memory would still be at historically high levels. But Mr. Hosseini does not expect Samsung's memory business to stabilize until mid-2019.
Write to Timothy W. Martin in timothy.martin@wsj.com
SOURCE LINK ERESVIRAL.COM https://www.beviral.online
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