A Samsung Electronics Co. corporate flag flies outside the company’s Seocho office building in Seoul, South Korea, on Wednesday, Feb. 7, 2018.
Jean Chung | Bloomberg | Getty Images
SINGAPORE — Samsung Electronics said Thursday its profit for the three months that ended in September likely rose 58% from a year ago.
Operating profit for the quarter likely came in at 12.3 trillion Korean won (about $10.6 billion) up from 7.78 trillion won a year ago, Samsung said in its earnings guidance. That was higher than the 10.5 trillion analysts predicted for the September quarter, according to Refinitiv SmartEstimate.
Consolidated sales were approximately 66 trillion won for the quarter, up about 6.5% from 62 trillion won a year ago.
Samsung shares traded down 0.33% Thursday morning, trailing South Korea’s benchmark index which was flat.
Though the company did not provide a breakdown on how each business unit performed, some analysts previously predicted the September quarter results would be driven by an uptick in smartphone sales in the second half of 2020 and higher overall memory-related earnings.
The mobile division as well as the consumer electronics and home appliance businesses likely contributed to Samsung’s strong earnings for the third quarter, according to SK Kim, executive director at Daiwa Securities. He explained Thursday on CNBC’s “Squawk Box Asia” that an improvement in Samsung’s cost structure, a shift to online marketing platforms in light of the coronavirus pandemic and pent-up demand helped bolster the company’s earnings.
Low memory chip prices due to an oversupply in the market likely affected Samsung’s main profit-making semiconductor business. A report this week from semiconductor researcher TrendForce said average selling price for memory chips is expected to remain weak in the fourth quarter of 2020 and decrease by about 10% on a quarterly basis. That was despite many smartphone brands stocking up memory products in light of U.S. sanctions on Huawei, the report said.
Kim told CNBC there is upside in demand for Samsung’s mobile chips while the display unit is set to receive a boost in the fourth quarter from a new iPhone launch — Samsung is a supplier of the high-end display screens used in iPhones.
Samsung posted an almost 23% jump in operating profit to 8.1 trillion Korean won (almost $7 billion) in the three months between April to June.
Full results for the September quarter are due later this month.