A South Korean flag, left, and Samsung Electronics flag fly outside the business’s head office in Seoul, South Korea, on July 5, 2019.
Jean Chung|Bloomberg|Getty Images
Samsung Electronics shares stopped working to keep earlier gains on Friday after the business stated its operating earnings for the quarter that ended in September was most likely 28% greater than a year earlier at 15.8 trillion Korean won ($1326 billion).
That’s set to be the South Korean semiconductor giant’s finest quarterly earnings in 3 years– considering that the 3rd quarter of 2018 when Samsung published a revenue of more than 17.5 trillion won.
Still, Friday’s figure fell listed below experts’ quotes of 16.1 trillion won, according to Refinitiv SmartEstimate.
Samsung shares increased more than 1% in early trade, however quit those gains to close 0.14% lower.
Consolidated sales for the quarter most likely increased to a record high of 73 trillion won– up 9% from a year earlier.
The South Korean tech giant did not break down how each service system carried out, including its primary profit-making semiconductor service.
But operations at the world’s biggest smart device and chipmaker have actually been impacted by a worldwide chip scarcity and the coronavirus pandemic that shuttered a few of its factories worldwide.
“Both earnings and operating earnings [are] lower than our price quote, and market price quote,” stated SK Kim, executive director and senior expert at Daiwa Capital Markets.
Samsung was partly impacted by the semiconductor scarcity, particularly in its smart device service, and most likely dealt with some logistics issues for its customer electronic devices system, Kim stated Friday on CNBC’s “Squawk Box Asia.” But increasing semiconductor costs most likely had a favorable influence on Samsung’s parts service, he included.
Daiwa has a rate target of 110,000 won (about $92) a share for Samsung, indicating more than 53% upside from Thursday’s close, as it anticipates greater semiconductor costs to drive the tech business’s profits.
Chip scarcity is starting to impact the smart device market where the similarity Samsung and Apple had actually up until now been protected from the fallout by stockpiling vital parts like memory chips.
Late last month, Counterpoint Research reduced its smart device delivery projections for the 2nd half of 2021, stating that some smart device makers are having a hard time to get all the parts they purchased to make mobile phones.
Full results for the September quarter are due later on this month.
Samsung shares are down more than 11% year-to-date.
