Oh no, you're thinking, yet another cookie pop-up. Well, sorry, it's the law. We measure how many people read us, and ensure you see relevant ads, by storing cookies on your device. If you're cool with that, hit “Accept all Cookies”. For more info and to customize your settings, hit “Customize Settings”.

Review and manage your consent

Here's an overview of our use of cookies, similar technologies and how to manage them. You can also change your choices at any time, by hitting the “Your Consent Options” link on the site's footer.

Manage Cookie Preferences
  • These cookies are strictly necessary so that you can navigate the site as normal and use all features. Without these cookies we cannot provide you with the service that you expect.

  • These cookies are used to make advertising messages more relevant to you. They perform functions like preventing the same ad from continuously reappearing, ensuring that ads are properly displayed for advertisers, and in some cases selecting advertisements that are based on your interests.

  • These cookies collect information in aggregate form to help us understand how our websites are being used. They allow us to count visits and traffic sources so that we can measure and improve the performance of our sites. If people say no to these cookies, we do not know how many people have visited and we cannot monitor performance.

See also our Cookie policy and Privacy policy.

This article is more than 1 year old

Samsung Electronics teases record Q1 profit

And yet its shares slumped. The reason? Fears of memory glut

Samsung Electronics has posted strong earnings guidance for Q1 of FY 2018.

The headline figures were sales of between 59 and 61 trillion Korean Won (US$57-59bn and operating profit around 15 trillion Won (US$14.5bn), a record for the quarter. Those numbers jumped from 50.55 trillion and 9.9 trillion in Q1 2017. Sales were down from Q4 2018’s 66 trillion, but operating profit held steady.

Even with all those lovely large numbers coming in, the company’s share price fell a point or two on Friday.

Analysts believe that was because of softness in two of Samsung Electronics’ key businesses.

One is premium handsets, as the company’s Galaxy S9 has been widely assessed as offering only small advances that punters aren’t rushing to buy.

nand

Blackout at Samsung NAND factory destroys chunk of global supply

READ MORE

The other is memory, a field in which Samsung has long been responsible for a big chunk of the world’s manufacturing capability. That’s mean fat profits. But now rivals like Micron are bringing DRAM to market to target servers, while numerous players have turned their attention to NAND for mobile devices. With smartphone sales recently declining for the first time, Samsung therefore faces the prospect of trouble in two key markets.

There’s a tiny ray of sunshine in analyst firm TrendForce reporting this week that Micron’s Taiwan DRAM factory experienced equipment failure and won’t return to full capacity until mid-April. That glitch will pop DRAM prices for a bit.

But probably not long enough to support Samsung’s share price, as that usually reflects investors’ assessment of future value.

Samsung’s guidance announcements usually precede full results by around three weeks. Once the company reveals more about its activities, so will The Register. ®

 

Similar topics

Similar topics

Similar topics

TIP US OFF

Send us news


Other stories you might like