Samsung Electronics Q1 net profits up by more than half

Doris Richards
April 26, 2018

Samsung Electronics Co. reported Thursday better-than-expected quarterly financial results as global data centers continued to fuel robust demand for its mainstay memory chips that posted another record-high quarterly profit.

"Therefore, its overall business performance will be about the same as the first quarter", he said, projecting a 15.5 trillion won operating profit.

Another business that contributed to Samsung's latest earnings was its mobile phone division that posted 3.77 trillion won ($3.49 billion) in quarterly operating income. The meeting ushered in a new generation of board members to help chart a path under Jay Y. Lee, a vice chairman who has led the company since his father Lee Kun-hee had a heart attack in 2014.

The South Korean rival and supplier to Apple has shipped about 10 million units of its flagship Galaxy S9 smartphone since sales began in mid-March, in what analysts said was a solid showing.

Bixby 2.0, an updated version of Samsung's AI assistant, will recognise each individual speaker when spoken to by multiple people and will be unveiled with the Galaxy Note 9 at the earliest, the company says. Samsung said the decrease came as it reduced its portfolio of low to mid-budget products.

In the display panel segment, which manufactures OLED and LCD screens, profits were affected by slow demand for flexible OLED panels and greater competition between rigid OLED and LTPS LCD.

Harman International Industries, acquired by Samsung past year, posted an operating loss of 40 billion won.

The firm, the world's biggest maker of memory chips and the flagship subsidiary of the sprawling Samsung group, has recovered from a series of setbacks to post record profits in recent quarters.

The company said the demand for DRAM chips for servers will not only grow in the United States but in China as well.

"Generating overall earnings growth across the company will be a challenge due to weakness in the display panel segment and a decline in profitability in the mobile business amid rising competition in the high-end segment", Samsung said in a statement.

Its logic chip and contract chip-making businesses also saw strong demand for chips used in smartphones and cryptocurrency mining, Samsung added.

Samsung added that it rolled out a facility investment of 8.6 trillion won in the first quarter, with the chip and display sectors taking up 7.2 trillion won and 800 billion won, respectively.

The company said it has not yet decided its yearly investment plan but hinted that the combined amount will fall from past year considering it already rolled out major investments in flexible OLED and other new technologies in 2017. "The company believes opportunities will widen for the set business as digital devices become increasingly connected".

Samsung Electronics also made a decision to hand out quarterly dividends of 17,700 won per share.

Samsung Electronics shares were up 1.1 per cent soon after the earnings release, while the KOSPI benchmark share price index was 0.6 per cent higher. The pair were released in March, in time for some sales to count toward the first quarter results.

Other reports by Iphone Fresh

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