On January 7, Reuters reported that Samsung Electronics said on Friday that its fourth-quarter operating profit may surge 52% year-on-year to 13.8 trillion won (about US$11.5 billion), the highest in four years, thanks to strong demand for server memory chips and improved chip foundry profit margins.
However, this estimate is still lower than the 15.2 trillion won estimated by Refinitiv Smart Estimate, a financial data research institution. Analysts attributed this to factors such as employee bonuses, marketing costs for the mobile business and rising costs of new display panels.
“The miss looks surprising, but I don’t think it’s as bad as it looks. It seems to reflect their various costs in the fourth quarter,” said Park Sung-soon, an analyst at Cape Investment & Securities.
"As of now it is unclear whether there are any changes in expected chip shipments," Park added.
Samsung estimated in a brief earnings report that its fourth-quarter revenue could rise 23% year-on-year to 76 trillion won (63.1 billion U.S. dollars), ahead of its detailed earnings release on January 27.
Analysts said Samsung's shipments of DRAM chips and NAND flash memory chips increased in the fourth quarter from the previous quarter, thanks to increased demand from server customers despite a fall in memory chip prices during the quarter.
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