Due to strong chip demand, Samsung may report the best profit in the fourth quarter Reuters

© Reuters. File photo: Samsung Electronics’ logo appears in an office building in Seoul, South Korea on October 11, 2017. REUTERS/Kim Hong-Ji/File Photo Global Business Weekly

Joyce Lee

SEOUL (Reuters)-Analyst estimates show that Samsung Electronics (OTC:) Co Ltd’s fourth-quarter profit may hit a record high due to strong demand for server memory chips and high contract manufacturing margins. According to Refinitiv SmartEstimate from 14 analysts, the world’s largest memory chip and smartphone manufacturer’s operating profit could reach 15.2 trillion won ($12.7 billion) in the quarter ending in December, and favor those that are more consistent and accurate Analyst. This will be a 68% increase from 9.05 trillion won a year ago, and slightly higher than the record profit of 15.15 trillion won in the fourth quarter reported in 2017.

As new data centers and demand for video, games, conferences, and other streaming services are driving the price of memory chips this year, Samsung Electronics’ stock price has risen about 12% in the past two months.

KB Securities analyst Jeff Kim said: “Contrary to previous concerns, the semiconductor industry may see a significant increase in demand from customers in the memory and non-memory sectors.”

“As of December, orders for memory chips from major North American data center companies such as Amazon (NASDAQ:), Microsoft (NASDAQ:) and Meta have steadily increased… and Samsung’s foundry business seems to have won two years of orders. 2023.”

This view is supported by the stronger-than-expected earnings results of its peer Micron Technology Corporation (NASDAQ:) in December and positive forecasts for the next quarter.

Analysts said that the profitability of Samsung’s chip foundry business, which competes with TSMC, has also increased significantly from the previous quarter, with an operating profit margin of between 10% and 20%, due to increased deliveries and price increases.

According to the average forecast of five analysts, Samsung’s overall chip profit in the fourth quarter may reach 9.7 trillion won, more than double the 3.85 trillion won last year.

The South Korean tech giant will announce preliminary results on Friday.

For Samsung’s mobile business, which was recently merged into a device experience (DX) division that includes TVs and home appliances, analysts said that due to the alleviation of component shortages, shipments may increase slightly from the previous quarter.

According to the average forecast of five analysts, the operating profit of the mobile business may be about 3 trillion won, an increase of about 24%.

Market participants will follow Samsung’s full performance later this month to learn about any latest impact on its Xi’an NAND flash memory chip manufacturing facility. Previously, the company said that due to strict restrictions on COVID-19 in Chinese cities, it will temporarily adjust Operations there.

Data company TrendForce said last week that there are currently no major interruptions in production at Samsung’s Xi’an plant.

(1 USD = 1,193.0000 KRW)

Disclaimer: Converged Media I would like to remind you that the data contained on this website may not be real-time or accurate. All CFDs (stocks, indices, futures) and foreign exchange prices are not provided by exchanges, but by market makers, so prices may be inaccurate and may be different from actual market prices, which means that prices are indicative and not Suitable for trading purposes. Therefore, Fusion Media is not responsible for any transaction losses that you may suffer as a result of using this data.

Converged Media Fusion Media or anyone related to Fusion Media will not be liable for any loss or damage caused by relying on the data, quotations, charts, and buy/sell signals contained in this website. Please fully understand the risks and costs associated with financial market transactions. This is one of the most risky forms of investment.

Source link

Leave a Reply

Your email address will not be published. Required fields are marked *