Published: Sat, April 07, 2018
Hi-Tech | By Kristin Zimmerman

Samsung Electronics tips record first quarter profit as chip boom winds down

Samsung Electronics tips record first quarter profit as chip boom winds down

In a separate development, prosecutors searched the offices of a Samsung's unit on Friday as part of a probe into allegations the conglomerate had sabotaged worker's efforts to set up stronger unions, Yonhap News Agency said.

Samsung, over the last one year, has seen record profits in its quarterly financial reports starting from the second half of 2017. The firm expects operating profits of 15.6 trillion won (around $14.6 billion), marking a 57.6 percent increase from the same period a year ago.

Meanwhile, the operating profit is at a record-high, above the 15.15 trillion won (~$14.2 billion) posted in the previous quarter and the 9.90 trillion won in Q1 2017 (~$9.4 billion). Samsung won't provide net income or break out divisional performance until it releases final results later this month.

The first-quarter result, which includes the sales of its marquee Galaxy S9 smartphone unveiled in February, may ease concerns about its display business after Apple sold fewer-than-projected iPhone X handsets with Samsung-made displays. Semiconductors play a vital role for the Korean tech company, and past year they accounted for 65.6 percent of the company's overall operating profit.

Samsung Electronics reported a 58% surge in profit, topping projections as demand for its memory chips remained strong enough to outweigh concerns about display supplies to Apple.

Rumours are now circulating that Samsung is already working on its next Galaxy S9 model, following a new benchmark result shared on the website Geekbench. That compares to the 14.5 trillion won average of analysts' estimates compiled by Bloomberg.

Samsung has released its earnings guidance for the first quarter of 2018, and it's another record for the company.

The firm expected the consumer electronics division's operating profit to increase by 32 percent to 500 billion won.

Whether Samsung's bullish performance will continue in the second quarter is in question, as Galaxy S9 sales are expected to slow and the Korean won continues to appreciate against the dollar.

Samsung shares fell as much as 2.7 per cent on Friday before paring losses to fall 0.7 per cent as of 0345 GMT (11.45 p.m. ET), compared to a 0.4 per cent drop in the wider market.

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