Samsung Electronics more likely to report finest quarterly revenue in 3 years

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  • Q3 working revenue estimated at 16.1 trillion gained
  • Brisk gross sales of recent foldable smartphones increase outcomes
  • Revenue more likely to hit 74.6 trillion gained, a file excessive

SEOUL, Oct 6 (Reuters) – Samsung Electronics Co Ltd (005930.KS) is more likely to flip in its finest quarterly revenue in three years and a file income, on rising reminiscence chip costs and brisk gross sales of its new foldable smartphones, analysts’ estimates present.

Operating revenue for the world’s largest reminiscence chip and smartphone maker possible jumped to 16.1 trillion gained ($14 billion) within the quarter ended September, in response to a Refinitiv SmartEstimate from 16 analysts, weighted towards those that are extra constantly correct.

That can be up 30% from 12.35 trillion gained a 12 months earlier and the best for the reason that third quarter of 2018. Revenue possible rose 11% to 74.6 trillion gained, a file excessive.

An unprecedented world scarcity in semiconductor chips amid the pandemic has underpinned Samsung’s outcomes and shares, which soared 45% final 12 months and hit a file excessive initially of 2021.

But the inventory has dropped since then, compounded by losses in September when U.S. peer Micron (MU.O)warned its reminiscence chip shipments would slip within the close to time period, amid business views that chip costs will tumble after peaking in July-September.

“Samsung shares have fallen due to Micron’s guidance but unlike Micron, Samsung internalises major components … and has other businesses like mobile and foundry to buoy performance,” mentioned Hanwha Investment & Securities analyst Lee Soon-hak.

“Memory (chip) prices are seen rebounding next year after a short period of decline,” Lee added.

Samsung will announce preliminary outcomes on Friday.

CHIP DIVISION, SMARTPHONES

Samsung’s chip division is more likely to report an working revenue of 9.9 trillion gained, a median of six analysts’ forecasts exhibits, up 79% from a 12 months earlier, helped by rising reminiscence chip costs and shipments.

Prices of DRAM chips, utilized in servers, cell phones and different computing units, jumped 7.9% versus the June quarter, whereas these of NAND flash chips that serve the info storage market rose 5.5%, information from analysis supplier Trendforce exhibits.

Analysts additionally forecast a double-digit working margin for Samsung’s chip contract manufacturing enterprise as shoppers rush to safe manufacturing capability.

Its cellular division possible noticed about 3.7 trillion gained in working earnings, analysts mentioned, down from 4.45 trillion gained a 12 months earlier however up from the prior quarter’s 3.2 trillion gained on foldable smartphones gross sales.

An estimated 2 million Galaxy Z Fold 3 and Z Flip 3 fashions had been bought in a month since launching in late August, with South Korea topping gross sales adopted by the United States, mentioned Jene Park, senior analysis analyst at Counterpoint. learn extra

Market members shall be scouring Samsung’s full outcomes later this month for an replace on its deliberate $17 billion U.S. semiconductor manufacturing facility after sources mentioned it was drawing nearer to finalising the development.

($1 = 1,187.9300 gained)

Reporting by Joyce Lee; Editing by Himani Sarkar

The logo of Samsung Electronics is seen at its office building in Seoul, South Korea, August 25, 2017.   REUTERS/Kim Hong-Ji/File Photo