Repercussions of the global economic downturn have made it to the earning reports of the major tech giants. Some companies are on the ledge and some are trying to recover from the past few months. The situation is not so different for the South Korean tech giant – Samsung considering the earnings guidance report of last quarter. The global giant is going through tough times, but the signs of increasing demand are paving the way for its recovery, per the new report.

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Samsung Q3 2023 Earnings Report

Samsung’s profit declined by 78% in Q3, 2023, but still, it is better than the company’s expectations. The increasing demand in the chip market is seen as early signs of recovery from the severe downfall.

As per the report, Samsung Electronic’s total revenue could be around KRW 67 trillion ($50.07 billion) with a profit of around KRW 2.4 trillion ($1.79 billion). In actuality, the company performed 400% better than Q3 2023 where it managed to rake KRW 0.6 trillion ($456 Million).

Apart from the increasing demands, Samsung’s increasing focus on high-end chips like DRAM is the primary reason for the recovery. It is expected to recover from the severe downfall in the coming quarters due to a rebound in the semiconductor chip demand. These chips are primarily used in AI and are expected to regain further its actual demand by the end of this year.

However, Samsung posted a profit of KWR 3 Trillion in Mobile Business, which is quite similar to last year’s Q3 earnings.

Apart from high-interest rates, the global economic slowdown has led to a downfall in the demand for consumer electronic goods, forcing manufacturers to reduce production.

Early this year, Samsung posted its worst Quarter profit in the last 14 years, the lowest since 2009.

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South Korean giant Samsung Electronics has today revealed that the company’s profit for the three months that ended in September, i.e. in Q3 2020, has likely witnessed a growth of 58 percent compared to last year.

As per the company, the operating profit for the third quarter of this year stands at 12.3 trillion Korean won, which is about $10.6 billion. Consolidated sales were approximately 66 trillion won for the quarter, up about 6.5 percent than a year ago.

The numbers revealed by Samsung in its earnings guidance is higher than the 10.5 trillion won that analysts had predicted for the September quarter. In the second quarter, the company had posted a 23 percent jump in operating profit to 8.1 trillion won (~$7 billion).

Samsung has not provided a breakdown of how its different business units performance. However, it is being speculated that the results are driven by a rise in smartphone sales, consumer electronics, and home appliances in the third quarter as well as higher earnings in the memory-related business.

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The South Korean giant is in a pretty good position right now and is expected to register further growth in the coming quarters, at the expense of Huawei. The Chinese giant is facing several issues and is currently fighting to keep its business afloat and the biggest beneficiary seems to be Samsung.

Apart from the smartphone business, Samsung is also impacting Huawei in the network equipment business. Last month, the company won a network equipment supply contract from Verizon worth around $6.6 billion.

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Samsung Electronics was dethroned from its world’s leading smartphone brand as China-based Huawei surpassed it in the second quarter of this year. This was mainly because of lower-than-expected sales of the flagship Galaxy S20 lineup.

However, now it seems that the company is in a better position. As per the reports, analysts believe that the company could report strong earnings for the third quarter of this year, mainly because of solid semiconductor business and smartphone sales.

It is being estimated that the South Korean giant could post a 20.7 percent increase in sales and about a 27.6 percent increase in operating profit compared to the numbers shared by the company for the previous quarter.

The prices for memory chips have declined in the market by 10 percent to 15 percent and despite that, Samsung has managed to sail through without a big drop in sales. In fact, analysts estimate that the chip business of Samsung could post an operating profit of around 5 trillion won for the third quarter.

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Further, the company’s foundry business also reported growth in Q3 2020 as it managed to secure chipset manufacturing orders from Qualcomm and NVIDIA. Another department where the company registers growth is smartphones.

As per the reports, Samsung’s smartphone business is estimated to report about 4 trillion won in operating profit for the third quarter of the year, more than double compared to 1.95 trillion won in Q2 2020.

The company reportedly managed to ship 80 million units of smartphones in Q3 2020, which is about 50 percent more than the previous quarter. On the other hand, sales of tablets reached 10 million units, an increase of 45 percent.

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