Samsung expects profits

Samsung expects profits

SEOUL - Agence France-Presse
Samsung expects profits

The exhibition room at the main office of Samsung Electronics Co. in Seoul. EPA photo

South Korea’s Samsung Electronics said July 6 it expects a record operating profit of 6.7 trillion won ($5.9 billion) in the second quarter, amid strong sales of its mobile devices.

Samsung, the world’s largest electronics company, was giving earnings guidance before official results later this month. The predicted operating profit for April-June would represent a 79 percent rise from a year earlier.

The previous highest operating profit was 5.85 trillion won in the first quarter. The company estimated a 19 percent rise in sales to 47 trillion won in the second quarter. It did not give a net profit figure or explain its forecasts.

Analysts said the strong result was largely thanks to robust smartphone sales. These account for more than half the operating profit despite the Korean firm’s continuing legal tussles with Apple.

Flat panel operation strong

They said a strong turnaround at the flat panel operation compared with a year earlier also helped the estimated bottom line.

Gains were likely to continue into the third quarter due to strong demand both for Samsung’s new Galaxy S III smartphone and for mobile devices developed by its rivals.

These would boost sales of Samsung’s chips and display components. “For the third quarter, we forecast revenue and operating profit will stand at a record high of 54 trillion won and 8.5 trillion, respectively, thanks to the effect of Galaxy S III on the handset and component divisions,” said Nomura analyst C.W. Chung.

He expected Samsung to ship more than 18 million Galaxy S III smartphones in the third quarter compared with 7 million in April-June.

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