Samsung Says First-Quarter Profit Likely $5.2 Billion, Beating Expectations Slightly.

Samsung Says First-Quarter Profit Likely $5.2 Billion, Beating Expectations Slightly.
Samsung

Overview Of The Samsung Company.

Samsung is a South Korean tech company that manufactures smartphones all over the world. Its competitors include Tim Cook’s Apple company and the Huawei phone company. The company also deals with consumer electronics such as fridges, microwaves, and television sets.

The Updates On Samsung’s Financial Performance.

Samsung is known for making huge profits because of its large market demand all over the globe. Recently, the operating profit for January, February and March up-scaled from the previous year of 2019. Besides, this was over and above the set expectations.

This year, Samsung performed even better. The company confirms 5.23 billion dollars in the first three months as its operating profit. This records an improvement of about 2.7% from the 6.23 trillion Korean won it recorded the previous year.

According to Refinitiv Smart Estimate, financial predictors foresee the company to calculate its operating profit to be close to 6.2 trillion won. Samsung anticipates for a first 3-months combined sales of over 50 trillion Korean won. This represented an increase of over 4.5% on the previous year. The company’s shares increased by around 1.03%.

Samsung Company Amid The Coronavirus Pandemic.

It is among the technology companies to put on record profits approximations for the recently passed quarter amid the crisis. Because of the pandemic, there have been doubts and assumptions concerning the demand growth curve on phones and electronics.

The adverse effects of the COVID-19 resulted in closing down the company’s workshops and outlets. This will eventually affect the level of sales of consumer electronics and smartphones.

According to John Hopkins University statistics, the virus cases are at 1.34 million people and the death toll reads over 74000.

Sk Kim, Executive Director At Daiwa Securities, Views.

He says the coronavirus outbreak forced many people to opt for working from their houses. Because of this, there are more online transactions and purchases by customers. As a result, there is an increase in demand for memory chips from data sources. These centers provide various forms of internet packages.

Kim says, “this will continue to drive memory price up in the next quarter, which will offset weakness on mobile and TV business”

The Semiconductor Business And Environment.

The company’s major earnings come from memory parts used in phones. The business accounts for over 60% of the company’s total earnings.

Sanjeev Rana, a financial analyst at CLSA, anticipates an up-scale of profits in the business. He adds on and says the selling prices for memory chips and PCs might go up at 20 and 10% respectively.

Rana says that because of lockdowns put, there will be a reduction in the smartphone’s shipments to countries. In return, it may cause a decline in demand too.

The semiconductor business has been bad for some time. This was because of unfavorable and low demand and prices for memory chips. However, there has been a positive change amid the coronavirus outbreak.

According to Chung, head of Korea’s research, the semiconductors’ export anticipation is to be positive this month. Besides, he gives a positive view of the prices of memory chips in that they will up-scale in the 1st 3 months this year. Chung says prices might increase higher in the next quarter and the market is likely to continue stronger.

Samsung Vs Apple Smartphones Appearance.

Samsung manufactures its phones in India, Vietnam and South Korea. It has little experience in production in China. The sad thing is that production in India is not going to be good due to the country’s 3-week lockdown.

For the case of Apple, it has limitations in supply for its smartphones and reduced China demand. This means that Samsung might increase its sales globally more than Apple smartphones.

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