The South Korean technology giant Samsung Electronics likely saw a surge of 38 percent for the second quarter of this year, i.e. Q2 2021, thanks to the increased and strong pricing for the chipsets in the market.
Demand for consumer electronics spurred, leading to the high demand for chips, creating a global shortage, leading to price hikes. This, along with recovering investment in data centers has resulted in good operating profit for the firm.
The report coming from Reuters adds that the operating profit for the world’s biggest memory chip and smartphone maker likely jumped to 11.3 trillion won ($10 billion), according to a Refinitiv SmartEstimate drawn from 20 analysts.
Prices of DRAM chips, widely used in servers, mobile phones, and other computing devices, jumped 27 percent compared to the March quarter, while those of NAND flash chips that serve the data storage market rose 8.6 percent, according to research provider Trendforce.
Profit also improved at Samsung’s chip-contract manufacturing and logic chip design business, partly because operations at its storm-hit Texas factory returned to normal. The estimated chip division’s operating profit in April-June rose about 22% from the year-earlier period to about 6.6 trillion won.
However, Samsung’s smartphone shipments dropped to about 59 million in April-June from about 76 million in the first quarter, according to Shinyoung Investment & Securities. Reduced demand from India, hard hit by the pandemic during the quarter, as well as tight supply for some mobile processor chips may also have affected shipments.
The strong performance of Samsung is coming despite the company shipping fewer smartphones than in January-March. This underscores the stratospheric demand for chips that have depleted stockpiles and filled production capacity.
It is said that the result would be up 20 percent from the first quarter and mark Samsung’s highest operating income in the second quarter since 2018 as the revenue is likely to rise by 15.4 percent. Samsung is scheduled to announce preliminary second-quarter results on Wednesday, i.e. 7th July.
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