Samsung's profit jumps 46 percent thanks to semiconductor

Lena Tucker
May 7, 2017

Samsung's Q1 2017 earnings are in, showing the company's highest quarterly profit since Q3 2013. Operating profit reached 9.89 trillion won, also up 48.27 percent from a year earlier.

Revenue edged up slightly to 50.55 trillion won for the first quarter.

Samsung Electronics has rejected a proposal to form a new holding company structure but said it would cancel treasury shares in a concession to shareholder pressure.

The Galaxy Note 7 was discontinued back in October and since then, Samsung had been working with mobile companies to release software updates to disable the phone.

This area was buoyed by price gains for both DRAM and NAND memory chips as supply growth constraints and demand for more firepower on devices such as smartphones and servers boosted margins, according to Reuters.

The mobile phone division's profit nearly halved between January and March compared to past year with no new handsets to generate meaningful sales.

"Pre-order numbers are up more than 40 per cent compared to last year's Galaxy S7 and S7 Edge, making this our best ever pre-order phase for a Samsung Mobile device".

Samsung did manage to balance out all the losses incurred after the Note 7 fiasco but that was entire because of company's other businesses such as semiconductor, display and memory branches.

Samsung recalled an estimated four million units of the Note 7 over concerns that batteries could overheat and burst into flames.

But the firm's mobile business saw sales and profit slow, with operating profits of 2.07 trillion won, down by 47% from a year ago.

It was humiliated by the Galaxy Note 7 recall a year ago, which cost it billions of dollars and dealt a blow to its reputation, but has just launched a new flagship device, the Galaxy S8, to positive reviews and strong orders. That said, Samsung Galaxy Note 8 will likely be getting the same sensor placement as Galaxy S8.

Despite the solid earnings, the company remains involved in a scandal, with chief Jay Y. Lee now on trial for alleged participation in a corruption case that brought down South Korean President Park Geun-hye.

South Korean shares shook off early losses and rebounded to near six-year highs on Thursday as Samsung Electronics' shares surged and as individual investors ramped up buying.

"We think there is room for even more progress due to the company's announced commitment to enhance its board".

Other reports by AllAboutTopnews

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