Chips are up as S9 smartphone maker Samsung tips record profit in Q1

6 Apr 2018

The Samsung S9 smartphone range. Image: Framesira/Shutterstock

Thanks for the memories, says South Korean tech giant Samsung.

Demand for memory chips as well as sales of smartphones have propelled Samsung to predict its highest ever quarterly profit.

Samsung, which is effectively the world’s largest smartphone and semiconductor maker, said it expects an operating profit of 15.6trn won ($14.7bn) for Q1 2018. That’s up 58pc from the 9.9trn won reported a year ago.

Samsung also expects that revenues will rise to 60trn won from the 50.5trn won reported last year.

Have another DRAM

However, there’s just no keeping some people happy as Samsung shares fell 1pc shortly after the announcement was made, as analysts forecast slower demand for DRAM chip prices.

They also tipped higher marketing costs for the flagship Galaxy S9 smartphone that was launched recently at Mobile World Congress in Barcelona.

Either way, Samsung is still winning because not only is it selling more memory chips and smartphones, but its display technologies feature on both the S9 as well as the Apple iPhone X and countless other flagship smartphones from rival manufacturers.

Samsung also became the world’s largest semiconductor maker by sales after overtaking Intel last year. Semiconductors account for the largest portion of Samsung’s profit.

However, chips appear volatile at present. Prices for 128GB NAND flash memories have fallen 10.7pc since December while prices for 32GB DRAM server chips climbed almost 6pc in the quarter.

The South Korean tech giant will break out divisional performance metrics when it releases its final results for Q1 on 26 April.

The Samsung S9 smartphone range. Image: Framesira/Shutterstock

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years