Working from residence boosted demand for gadgets powered by Samsung’s chips, in addition to residence home equipment, corresponding to TVs and washing machines
Samsung Electronics Co yesterday forecast an expectations-beating leap of greater than 53 p.c in second-quarter working revenue, because of sturdy chip costs and operations resuming at a key US manufacturing facility.
The world’s greatest smartphone maker stated in an earnings estimate that it anticipated working revenue of about 12.5 trillion gained (US$11 billion) for the second quarter, up from 8.15 trillion gained final 12 months.
The figures have been forward of an 11 trillion gained common of estimates, Bloomberg Information reported.
COVID-19 pandemic-driven working from residence has boosted demand for gadgets powered by Samsung’s chips, in addition to residence home equipment, corresponding to TVs and washing machines.
It estimated gross sales for the interval at 63 trillion gained, up about 19 p.c year-on-year.
Analysts stated the corporate has had a selected increase from memorychip value hikes.
Taipei-based market researcher TrendForce Corp (集邦科技) final month anticipated costs of reminiscence chips, particularly DRAM — extensively utilized in servers and cellphones — to rise by way of the third quarter of this 12 months as a “extreme undersupply scenario persists.”
Samsung’s earnings “will stay stable, principally attributable to elevated demand for reminiscence chips, rising DRAM costs,” stated Tom Kang, a analysis director at market researcher Counterpoint.
Energy outages throughout Texas — brought on by a extreme winter storm — shut down semiconductor factories clustered round Austin in February, together with Samsung’s.
The agency misplaced greater than 300 billion gained because of the suspension, Yonhap information company reported.
Samsung stated the manufacturing line in Texas was “absolutely normalized within the second quarter,” and IBK Funding & Securities Co analyst Kim Woon-ho stated the manufacturing facility’s resumption had been constructive for second-quarter earnings.
Nonetheless, the corporate’s smartphone shipments are estimated to have dropped as gross sales slowed for its newest flagship product, the Galaxy S21, launched in January.
“It’s estimated that Samsung’s cell manufacturing strains in Vietnam and India didn’t function correctly attributable to COVID lockdown,” Kim stated in a report.
Moody’s Buyers Service vice chairman Gloria Tsuen had a constructive outlook for the agency for the second half of the 12 months.
“The important thing earnings driver for Samsung will nonetheless be semiconductors,” Tsuen stated.
Nonetheless, the corporate faces authorized challenges.
Samsung Electronics vice chairman Jay Y. Lee is on trial, charged with manipulating a takeover to easy his succession on the high of Samsung Group.
Lee was individually jailed in January over a sprawling corruption scandal that introduced down former South Korean president Park Geun-hye.
South Korea’s company leaders and teachers say a management vacuum might hamper the agency’s decisionmaking on large-scale investments, beforehand key to its international rise.
In the meantime, LG Electronics Inc, South Korea’s second-largest equipment maker, forecast a 65.5 p.c leap in working revenue for the second quarter to 1.1 trillion gained.
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