Samsung reports 0.15 pc decrease in Q1 operating profit, logs strong phone sales
Samsung Electronics on Tuesday estimated its first-quarter operating profit edged down 0.15 percent from a year earlier but exceeded market expectations on strong sales of its new flagship smartphones. The world's biggest maker of memory chips expected an operating profit of 6.6 trillion won (US$4.5 billion) for the quarter ending in March. The operating profit was 33.5 percent higher than the average estimate of 4.9 trillion won, according to a survey by Yonhap Infomax, the financial data firm of Yonhap News Agency. Sales increased 9.8 percent to 79 trillion won. The data for net income was not available. Experts noted the better-than-expected performance may be attributable to the popularity of the new Galaxy S25 smartphones, which went on sale in February. Samsung Electronics did not release a detailed earnings report of its business divisions, but the market forecast that the company's semiconductor business earned around 1 trillion won in operating profit for the first quarter. The company will release its final earnings report later in the month. Some analysts forecast that Samsung Electronics' earnings will rebound in the second quarter, driven by recovering demand for memory chips from China and rising prices of dynamic random access memory (DRAM) products. "Shipments of memory chips will rebound, and prices of memory products like DDR5 and NAND flash are also expected to increase in the second quarter," said Han Dong-hee, an analyst at SK Securities Co. Others remained cautious, pointing to growing uncertainty stemming from U.S. President Donald Trump's tariff policies and Samsung Electronics' sluggish performance in the high-margin high bandwidth memory (HBM) sector. Samsung Electronics' HBM chips have reportedly struggled to pass Nvidia Corp.'s quality tests, preventing the company from joining the global HBM supply chain, which is currently dominated by Nvidia, SK hynix Inc. and TSMC. "Even if Samsung's HBM products gain approval, it will be difficult for the company to see a significant boost in profits, as its competitors have already secured Nvidia's orders," said Noh Geun-chang, an analyst at Hyundai Motor Securities Co. "A rebound in memory demand and prices is expected, but it may not be strong or sustained."
