Samsung Electronics reports 88.9 percent jump in Q2 net profit

Posted July 27, 2017

On Wednesday, the carmaker said its second-quarter net profit plunged 48 percent on-year on weaker demand from China amid a diplomatic row between Seoul and Beijing over the deployment of a USA missile defense system here.

Wall Street Journal Samsung's massive earnings growth could top Apple's quarterly profits for the first time in history, a very good news for the South Korean tech giant indeed. It said it also expects to see increased orders of memory chips for smartphones with a number of handset manufacturers set to launch new models in the second half of the year. That demand, coupled with a tight supply, has seen the price of memory chips shoot up over the previous year, bringing an unprecedented level of profitability to suppliers such as Samsung.

Intel, which reports its quarterly earnings later Thursday, is expected to report $14.4 billion in quarterly revenue.

However, Samsung said the outlook for its semiconductor business still looks rosy, as it expects companies to continue adding to their server memory capacity.

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The chip unit achieved this performance thanks to strong demand for high-density DRAMs and SSDs for servers in a low-supply environment. Apple is forecast to report $8.2 billion in net profits next Tuesday, according to data by FactSet.

SK hynix, a major chipmaker, advanced 2.4 percent to 68,400 won, but Samsung Electronics actually edged down 0.08 percent to end at 2,490,000 won, as investors opted to cash in profits, according to analysts.

In the second quarter, the divisions producing semiconductors and components boosted the company's accounts by jointly achieving 42.83 trillion won in revenue, which is 40.7 per cent more than in the same quarter of 2016.

Earlier this month, Samsung announced plans to invest $18 billion to expand and upgrade its chip plants in Korea, with the aim of extending its lead in the market. The rising use of vehicle connectivity and the "internet of things" is expected to drive still further demand for the chips that have helped Samsung move ahead, at least for now.