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Samsung Electronics Expects Second-Quarter Operating Profits to Rise more than 15 - Fold on-Year

CIO Insider Team | Friday, 5 July, 2024
Separator

Samsung Electronics expects operating profit in the second quarter to rise more than 15 times year-on-year as chip prices recover and demand for generated AI continues to grow.

The company, the flagship subsidiary of South Korean giant Samsung Group, is overwhelmingly large among the family-run conglomerates that dominate business in Asia's fourth-largest economy.

The world's largest memory chip maker said in a regulatory filing that its month-to-month operating profit is expected to rise to 10.4 trillion won ($ 7.54 billion), up 1,452.2 percent from 670 billion won a year earlier.
The forecast exceeded the average estimate by 25.8 percent, according to South Korea's Yonhap news agency, which refers to the financial data firm.

Meanwhile, Samsung said sales are expected to rise 23.3 percent to 74 trillion won. Semiconductors are the lifeblood of the global economy and are used in everything from kitchen utensils and mobile phones to cars and weapons.

“The development of AI has driven the demand for high-capacity SSDs," Taipei-based research firm TrendForce's analyst Avril Wu said, referring to a new generation of computer storage devices.

Semiconductors are South Korea's major exports, accounting for one-fifth of South Korea's total exports, accounting for the highest level in nearly two years, hit 1.17 billion in March, according to figures released by the Ministry of Trade.

Due to Samsung's ability to produce higher-layer, non-volatile storage that does not require power to retain data, the firm "is expected to be one of the main beneficiaries

The United States on May 4 announced a grant of up to Samsung 64 billion to Samsung to produce state-of-the-art chips in Texas.

“Due to Samsung's ability to produce higher-layer, non-volatile storage that does not require power to retain data, the firm "is expected to be one of the main beneficiaries,” Wu says.

Samsung is expected to unveil its latest folding smartphone with AI capabilities and various accessories, including a new health monitoring Smart Ring, in Paris on July 10th.

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