Samsung Electronics forecast Q1 operating profit and sales would increase modestly, as brisk demand for memory chips was expected to offset declines in smartphone shipments caused by the Covid-19 (coronavirus) outbreak.
In earnings guidance issued today (7 April), the South Korean company estimated operating profit would increase 2.7 per cent year-on-year to about KRW6.4 trillion ($5.2 billion), with revenue to rise 5 per cent to KRW55 trillion.
Its semiconductor business, which accounts for the majority of its profit, experienced strong demand for chips powering data centres and cloud services, as lockdowns drove a surge in internet usage, Bloomberg wrote.
Samsung doesn’t disclose net profit or break out operating profit and revenue by division in quarterly guidance. It is expected to release detailed earnings later this month.
However, at its annual shareholder meeting last month, it predicted a return to growth for the memory chip market, but hard times for smartphone sales due to the pandemic.
At the time, Koh Dong-jin, president of the vendor’s mobile and network business, said measures to contain the outbreak could impact a nascent recovery tipped for the global smartphone market in 2020.
Reuters reported Samsung expects measures to slow the pandemic to have a stronger impact on its second quarter results.Subscribe to our daily newsletter Back