Samsung Reported a Likely 53% Rise in Q2 Operating Profit

On July 7, Samsung Electronics, a South Korean multinational electronics firm, reported a likely 53% rise in second-quarter operating profit. The firm beat market expectations with the help of good chip prices and demand despite lower smartphone sales.

According to the several data, it is up 33% from the first quarter.

Samsung reported that a profit for the quarter ended June 30 was likely 12.5 trillion won, which equals $11 billion. If confirmed, it would be the firm’s largest second-quarter profit since 2018.

According to Park Sung-soon, an analyst at Cape Investment & Securities, given peak seasons for mobile and display businesses and strong mobile DRAM memory chip prices, third-quarter profit is likely to be even higher.

For Q2, Samsung’s chip division profit increased by a fifth or more from a year earlier. According to the analysts, the rise had support from high memory-chip costs and demand for consumer electronics.

Samsung’s memory chip shipments were larger than anticipated. Remarkably, DRAM chip shipments were especially high. Those chips are crucial parts of servers, mobile phones, and other computing devices.

Analysts said that improved yield in cutting-edge 1z nanometre DRAM chip production using ASML’s EUV machines reduces costs from the first quarter.

Samsung’s Revenue Rose 19% from The Same Period a Year Earlier

According to analysts, profits at Samsung’s chip contract manufacturing and logic chip design businesses were likely to have developed too. They named the reason operations at a storm-hit factory in Texas, which returned to normal.

As we remember, the tech giant witnessed strong declines throughout the COVID-19 pandemic. Samsung’s smartphone shipments dipped to around 59 million in April-June from approximately 76 million in the first quarter. This came as sales of its flagship model launched in the first quarter reduced.

Analysts also reported that fresh coronavirus outbreaks in several regions and a low supply of mobile processor chips also affect smartphone shipments in the quarter. They say that these improved in the second half of the year.

According to Samsung, its revenue lifted an estimated 19% from the same period a year earlier to 63 trillion won.

Remarkably, at the time of writing, Samsung Electronics stocks are traded nearly 80,800 won, which equals $70.76. The stocks sharply boosted after the announcement and hit as high as 81,200.