Samsung Forecasts 56 Percent Spike In Profit On Strong Memory Demand
Samsung Electronics has announced its estimates for Q1 operating profit, which jumped 56% to a record high. Analysts believe that the increased profit estimates have to do with high demand for DRAM memory chips. That record demand for memory could be an offset to the glut of inventory Samsung has on the display side. Samsung allegedly is scrambling to find buyers for the OLED screens it made for Apple after the company reportedly reduced orders due to slow sales of the iPhone X.
Samsung has stated that its preliminary earnings reports for the quarter spanning January-March 2018 had operating income estimated to be 15.6 trillion won, which is about $14.7 billion. The same quarter a year before saw earnings of 9.9 trillion won. Sales for Q1 2018 rose 19% to 60 trillion won and as of now, no estimated net income figures have been shared. Additional details with breakdowns among its various businesses are expected at the end of April.
Samsung is expected to post lower profits in the display business due to Apple's sales issue with the very expensive iPhone X. Samsung has been doing very well thanks to the high demand for DRAM chips that are used by other smartphone makers and electronics vendors. Demand for those memory chips allowed Samsung to swipe the title of "world's largest semiconductor maker" from Intel last year.
Analysts expect Samsung's mobile business to post income higher than expected in Q1 thanks to solid smartphone sales. Samsung unveiled the Galaxy S9 line in February and sales of its older devices remain strong according to reports.