Samsung tops profit estimates
SEOUL: Samsung Electronics Co. beat analysts’ profit estimates on booming exports of memory chips, but warned of challenges in smartphone demand in the coming months.
Net income rose to 11.6 trillion won ($10.7 billion) in the three months ended March, the Suwon, South Korea-based company said in a filing on Thursday, exceeding the 10.9 trillion won average of projections compiled by
Sales climbed 20% to 60.6 trillion won.
Although the results demonstrate the chips business is strong, Samsung offered no such reassurance for the smartphone industry, where suppliers have issued gloomy outlooks and seen their shares fall in the past two weeks. The Korean company said its own mobile division will see declining profitability amid weak demand and warned of softer demand for the screens used in Apple Inc.’s flagship iphone X smartphone.
“Semiconductors are doing better and it sets the stage for a very strong second quarter,” said Sanjeev Rana, a Korea technology analyst at CLSA.
The mobile-phone industry has hit a slowdown as major markets from the US to China grow more saturated. Global smartphone shipments fell 8.5% in the fourth quarter and declined 0.5% for the year, according to researcher IDC. Samsung held 22% of the market in 2017 based on shipments, while Apple had 15%.