Best-selling smartphone, Samsung is expected to record profit in Q1

Samsung Electronics’ profits are forecast to grow 45% in the first quarter according to a survey from 16 analysts at Refinitiv SmartEstimate. This was mainly due to the sharp increase in sales of smartphones, TVs and home appliances.

This forecast is made despite the impact of Samsung’s chip profits when the factory in the US has to interrupt production because of the snowstorm.

According to analysts, the Covid-19 pandemic left more people at home and spurred them to purchase more consumer electronic devices. This is also one of the reasons for the shortage of semiconductors globally.

Analysts in a Refinitiv SmartEstimate survey forecast Samsung Electronics’ operating profit to grow to 9,300 billion Won ($ 8.2 billion) in Q1 / 2021. These results will mark the first quarter with the highest operating profit in the company’s history. During the quarter, Samsung Electronics’ profit is forecast to increase 12% year-on-year. The company plans to release its first quarter preliminary business results on Wednesday (April 7).

Analysts say Samsung’s mobile phone business has had a quarter of outstanding growth with the launch of the Galaxy S21 smartphone series in mid-January – a month earlier than the launch of the product line. The company’s annual routine.

According to Counterpoint Research, Samsung Electronics, the world’s largest smartphone maker, held nearly 23% of the global smartphone market share in the first quarter, thanks to new product launches as well as “cheaper than usual” pricing for advance product. For example, the Galaxy S21 smartphone is priced at $ 200 lower than its predecessor, the Galaxy S20.

Accordingly, the market share of Samsung Electronics has increased significantly compared with 20% in the first quarter of 2020 and 16% in the fourth quarter of 2020 – when the “rival” Apple launched the iPhone 12.

Analysts also said that the accessories business with products such as Samsung Electronics’ Galaxy Buds headphones also had a good quarter. It is estimated that in the first quarter, operating profit from this segment increased by 1,000 billion won over the same period last year, to about 4,150 billion won.

Operating profit for the TV and home appliances business of Samsung Electronics is also forecast to double to about 1,000 billion Won.

Meanwhile, despite a spike in global chip demand, Samsung’s chip profit is forecast to drop nearly 20% to 3,600 billion won. This is due in part to the rising costs of the company increasing production as well as the damage caused by the Texas factory shutdown due to a snowstorm in February. By the end of March, the factory was back to operational level. almost normal. Analysts estimate production disruption at this plant cost Samsung around 300-400 billion won.

Source: CNN