Samsung Electronics has revealed that it is expecting a massive 931% increase in its first quarter operating profit. The company expects the operating profit in the January-March quarter to have risen to 6.6 trillion Korean won ($4.89 billion), a significant surge from the previous year. This news comes as chip prices rebound, indicating a positive outlook for the company.
In addition to the surge in operating profit, Samsung Electronics also anticipates an 11.4% increase in revenue for the first quarter. The revenue is expected to reach 71 trillion won, showcasing a steady growth in the company’s financial performance. The firm’s revenue estimate surpasses the predictions made by LSEG analysts, reflecting a strong market presence and demand for Samsung’s products.
Market Expectations
Analysts at Daiwa Securities are optimistic about Samsung Electronics’ performance in the first quarter of 2024. They predict that the company will deliver solid earnings driven by memory price increases and robust sales of the S24 model. The strong AI-driven memory upturn cycle is also expected to contribute to the company’s earnings in the coming years. Daiwa Securities has maintained a “buy” rating on Samsung Electronics and raised the price target to 110,000 won, indicating confidence in the company’s growth potential.
The global foundry industry saw a slight uptick in revenue in the fourth quarter, signaling a potential recovery in demand for memory chips. Samsung Electronics, being the largest producer of dynamic random-access memory chips, stands to benefit from this positive trend. After experiencing a significant drop in memory chip prices last year, the market now appears to be stabilizing, with production cuts helping to balance supply and demand.
Despite continued macroeconomic uncertainties, Samsung Electronics is poised to announce strong earnings for the first quarter of 2024. The company’s focus on innovation, coupled with the recovery in chip prices, bodes well for its future growth. As one of the leading players in the semiconductor industry, Samsung Electronics is expected to maintain its position and continue delivering strong financial performance in the upcoming quarters.
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