Samsung Electronics, the flagship subsidiary of South Korean conglomerate Samsung Group, anticipates a significant surge in first-quarter operating profits, propelled by a recovery in chip prices.
According to a regulatory filing on Friday, the tech giant expects operating profits for January to March to rise by 931.3%, reaching 6.6 trillion won ($4.89 billion). This marks a substantial increase from around 640 billion won recorded in the same period last year.
The projected operating profits surpassed the average estimate by 20.5%, as South Korea’s Yonhap news agency reported, citing data from its financial analysis firm. According to Samsung’s statement, sales are expected to increase by 11.4% to 71 trillion won.
South Korean chipmakers, including Samsung, have enjoyed record profits as product prices surged in recent years. However, a global economic slowdown has impacted memory chip sales. Nevertheless, according to industry monitor World Semiconductor Trade Statistics, the semiconductor market is anticipated to rebound this year, with an expected growth of 11.8%.
The optimistic outlook from Samsung follows a similar announcement from SK Hynix, the world’s second-largest memory chip maker, which returned to profit in January after four consecutive quarters of losses.
Neil Shah, vice president of Counterpoint Research, highlighted Samsung’s favorable prospects, citing a resurgence in the smartphone market and escalating DRAM (memory chip) prices.
Samsung is scheduled to release its final earnings report at the end of this month, providing further insights into its performance.
