Samsung forecasts nearly nine-fold rise in third-quarter operating profit
The chipmaker's estimate exceeded analysts' expectations, while revenue is projected to increase 127% to 195 trillion won.
Samsung projects record quarterly profit as AI lifts memory sales
The company estimated operating profit of 107.4 trillion won and said revenue would likely rise 127%. Detailed results are scheduled for October 29.
Samsung Electronics put its third-quarter operating profit forecast at 107.4 trillion won on October 8, nearly nine times the year-earlier level, with memory sales benefiting from demand for artificial intelligence chips. The estimate in its regulatory filing surpassed the LSEG SmartEstimate of 106.1 trillion won.
If achieved, the figure would extend Samsung's run of record quarterly operating profits to four. Samsung said July-September revenue would likely reach 195 trillion won, up 127% from a year earlier. It will provide divisional earnings and other details on October 29.
Analysts expect memory chips to contribute most of the profit improvement. Limited supplies of conventional DRAM and NAND chips, together with increasing demand for high-bandwidth memory used in AI, have lifted prices. Douglas Kim of Douglas Research Advisory estimated that Samsung shipped close to 50% more HBM bits than in the preceding quarter.
Yuanta Securities analyst Lee Jae-won said the earnings exceeded expectations following cuts to analysts' estimates. He also said investors would look for details on shareholder returns at Samsung's earnings call later in October.
The price increases are also squeezing margins in Samsung's smartphone and consumer electronics operations by raising component costs. Analysts expect the foundry business to keep posting losses because of fixed costs and low utilization, though they anticipate utilization will improve over the coming quarters.