Samsung Electronics’ second-quarter profit likely rose 11% on strong demand for server chips

Samsung Electronics on Thursday reported a weaker-than-expected increase in quarterly operating profit as lower sales to inflation-hit smartphone makers weighed on profits for customers of servers that load memory chips.

The world’s largest memory chip and smartphone maker estimated that its profit rose 11% from a year earlier to KRW 14 trillion (nearly Rs 84,600 crore) in the three months ended on June 30 – its highest profit in the second quarter since 2018 – of KRW 12.57 trillion (about 76,000 crore) a year earlier.

The profit is less than KRW 14.45 trillion (about Rs 88,000 crore) Refinitiv’s SmartEstimate.

Revenue likely rose 21% from the same period a year earlier to KRW 77 trillion (about Rs 4.6 lakh crore), Samsung said in a brief preliminary earnings statement, in line with market expectations.

Samsung is expected to release detailed earnings later this month.

Earlier on Tuesday, it was reported that Samsung would likely post its best April-June profit since 2018 with a 15% year-on-year increase as continued demand for its memory chips from server customers offsets the drop. sales due to inflation. smartphone manufacturers.

Operating profit at the world’s largest smartphone and memory chip maker likely jumped to KRW 14.46 trillion in the quarter, according to a 24 analyst Refinitiv SmartEstimate, from KRW 12.57 trillion about a year earlier. early.

Its chip revenue likely soared 49% to KRW 10.3 trillion (about Rs 62,500 crore), according to an average of seven estimates. The chip business accounts for about half of the South Korean tech giant’s profits.

On the overall outlook for global memory chip demand, CAPE Investment & Securities analyst Park Sung-soon said U.S. data center companies such as Amazon, Microsoft, Google and Meta are expected to continue buying “for meet the growing demand for the cloud”. services”.

© Thomson Reuters 2022


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