Sales for the third quarter are expected to reach 51 trillion won, up 7.5 percent from a year earlier, the company said in a statement. In the third quarter of 2014 Samsung reported dramatically weaker profit and sales figures. With $55 billion in cash, the company may be poised to offer consolation.
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Shares jumped 5.6%, the most since June 2013, to 1,215,000 as of 10:33 am in Seoul. But the world’s largest smartphone maker is still struggling to maintain its market share amid intense competition from Apple, Huawei and Xiaomi.
Global chipmaker SK hynix gained 0.27 percent to finish at 37,300 won.
In the summer, Samsung said it would be ‘adjusting’ (or discounting) the price of its flagship Samsung Galaxy S6 and Galaxy S6 Edge as it revealed it had not hit its sales goal for its most recent devices.
On the component front, the company’s advanced displays called OLED likely generated a fat profit because more Samsung handsets adopted those screens.
But brisk businesses in chips and displays has largely compensated for these difficulties, analysts said.
To get a sense of scale, compare Samsung’s semiconductor operations with Intel.
“But the division’s profitability probably worsened due to falling prices”. This enabled it to starting using its own chips in all Samsung smartphones, instead of ordering from suppliers like Qualcomm, and in turn helped boost its semiconductor business. Sales are estimated to be 12 trillion won. As predicted, the profits and mobile margins are expected to decrease in a periodic manner.
Its semiconductor business was estimated to have performed well during the quarter on the back of predominant technological prowess in the nano-level making of DRAM chips and brisk sales of system LSI chips.
Samsung’s been in somewhat of a sales funk ever since the launch of its Galaxy S5.
Samsung’s display earnings have also increased remarkably.
The prediction beats the estimate of 6.7 trillion won given by analysts surveyed by Bloomberg News.
There is an expectancy that the company will announce plans like dividend payout or share buyback as the year comes to an end, said Yoo Jong Woo, an analyst at Korea Investment & Securities Co. The 12-month consensus price target for shares is ₩1282.52, reflecting a 46.57% upside potential over the stock’s previous close. “The time has come to reassess the value of the company’s component sectors”, said Lee Jae Yun, an analyst at Yuanta Securities Korea Co.
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The South Korean electronics giant has had a relatively rough time of it over the past two years, suffering year-on-year profit drops across each of the last seven quarters.
