Samsung’s good year keeps on getting better. After announcing record-breaking figures for the second quarter, the tech giant looks set to announce another bumper quarter for the period of July-September. Shares in the electronics company jumped by 4.5 per cent this morning as analysts predict the tech giant to announce record profits in its memory chips for the third quarter.
Earlier this year, many analysts predicted that Samsung would take Intel’s memory chip crown before the end of the year. Many industry analysts predicted that Samsung would dethrown Intel as the number one chip manufacturer in the world. It came after the South Korean tech giant has reported record quarterly profits, thanks largely to a boom in demand for its memory chips, for the second quarter.
Reporting an operating profit of 14 trillion won (£9.3 billion) in the three months up to June, Samsung increased profit by 72 per cent year-on-year. Sales climbed 18 per cent to 60 trillion won, buoyed by strong sales of smartphones including the new flagship Galaxy S8.
The numbers prove that Samsung has overcome the disastrous embarrassment caused by the Galaxy Note 7 recall, after users complained of the device ‘exploding’ or catching on fire due to a battery fault. The company suffered a further PR nightmare when its chief Jay Y Lee was arrested over an ongoing political bribery scandal. However neither the Note 7, nor Lee’s upcoming trial appears to have affected the running of the company.
Benefitting from both a rise in demand and price for semiconductors and smartphone memory chips, many industry analysts now believe Samsung could outdo Intel in terms of sales in 2017. It would be the first time Intel was knocked off the top of the global semiconductor market-share rankings for the first time since 1991.
The company has also been buoyed by the sales of its OLED screens. In fact, Samsung is set to make more money from Apple’s upcoming iPhone X than its own flagship Galaxy S8.
That’s according to analytics firm Counterpoint Technology, which reckons that the Cupertino Mac-maker is so reliant on Samsung components that the Korean giant will net more cash from the parts in the new iPhone. This is largely thanks to Apple’s dependency on Samsung’s NAND flash memory chip and DRAM chip which has been ongoing for years, but in this year’s model the phone includes a pricey Samsung OLED display as opposed to the Retina screens used for the past few iterations.
Samsung will reportedly pocket a profit of about $110 (around £85) per unit sold. That means if Apple sells, as believed, 130 million phones in the first 20 months that Samsung will make roughly $14.3 billion (around £10.8 billion) in profit. By contrast, while Counterpoint claims Samsung makes $202 (around £155) from each Galaxy S8 sold, it’s expected that only about 50 million units will be sold in the first 20 months.