Samsung Electronics’ fourth quarter profit jumps on server chip demand and foundry margins

Samsung signage is seen in a store in Manhattan, New York, United States on November 22, 2021. REUTERS / Andrew Kelly

Register now for FREE and unlimited access to


SEOUL, Jan. 7 (Reuters) – Samsung Electronics Co Ltd (005930.KS) on Friday said its fourth-quarter operating profit likely jumped 52% year-on-year to its highest quarterly level in four years, helped by high demand for server memory. chips and higher margins in contract manufacturing of chips.

The world’s largest maker of memory chips and smartphones estimated October-December profit at 13.8 trillion won ($ 11.5 billion), which would be the highest operating profit for the computer giant. technology in the fourth quarter since the fourth quarter of 2017.

The result missed a Refinitiv SmartEstimate of 15.2 trillion won, which analysts attributed to things like employee bonuses, marketing costs for its mobile business, and the costs of ramping up new business panels. display included in the quarter.

Register now for FREE and unlimited access to


“It sounds like a shock because it came out less than the consensus, but I don’t think it’s as bad as it looks. It looks like they reflected various costs in Q4,” Park said. Sung-soon, analyst at Cape Investment & Securities.

“At this time, it is not known if there have been any changes in expected chip shipments,” Park added.

Revenue likely rose 23 percent from the same period a year earlier to 76 trillion won, the company said in a brief release of preliminary results, in line with market expectations.

Samsung is due to release its detailed results on January 27.

Although memory chip prices declined during the quarter, increased demand from server customers drove Samsung’s quarterly shipments of both DRAM chips, which are widely used in data centers, and NAND flash memory chips, used for data storage in technological devices, analysts said. .

Samsung shares rose 1.3% in morning trading.

Shares of Samsung Electronics have climbed around 11% since early November in anticipation of less than expected memory chip prices in the first half of this year and then a rebound, spurred by newer centers. data and demand for videos, games, conferences and other heavy traffic. services.

Samsung’s logic chip business, which includes contract manufacturing of chips competing with Taiwan Semiconductor Manufacturing Co (TSMC), is also expected to report operating profit above 1,000 billion won in the December quarter due to of more deliveries and higher prices, Hanwha Investment & Securities analyst Lee Soon-hak said.

Estimated smartphone shipments by Samsung’s mobile business were around 67 million, nearly 69.3 million in the previous quarter, Counterpoint Research said, helped by reducing component shortages, although marketing costs have fallen. weighed.

The company recently merged into a single Device Experience (DX) division with television and home appliances.

($ 1 = 1,204,0400 won)

Register now for FREE and unlimited access to


Reporting by Joyce Lee and Heekyong Yang; Additional reporting by Choonsik Yoo; Editing by Richard Pullin

Our standards: Thomson Reuters Trust Principles.

Source link

Previous AscellaHealth Launches Expanded Website: User-Friendly Content on Global Pharmacy and Specialty Healthcare Services for Patients, Payers, Life Sciences and Providers | News
Next NFL Week 18 Live Stream: How To Watch The Playoff Race Online From Anywhere