Samsung Electronics anticipates a 78% drop in third-quarter profit

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Samsung Electronics, the South Korean chip behemoth, has forecasted a significant 78% decline in operating profit for the quarter ending in September, according to the company’s recently released guidance.

The anticipated revenue for the third quarter is projected to be approximately 67 trillion South Korean won ($50.02 billion), with an expected operating profit of around 2.4 trillion won. This is in contrast to the 76.78 trillion won in sales and 10.85 trillion won in operating profit reported during the same period last year.

In comparison to the second quarter, the third-quarter guidance signifies an 11.5% increase from the revenue figure of 60.01 trillion won, and a substantial increase of more than three times the 670 billion won in operating profit.

Samsung’s operating profit guidance slightly surpassed analysts’ expectations. Prior to the release of the guidance, analysts surveyed by LSEG had estimated an operating profit of 2.3 trillion won for the September quarter, indicating a 78.7% year-on-year decrease. Additionally, revenue was predicted to reach 67.8 trillion won, representing an 11.6% decline, as per forecasts from LSEG, previously known as Refinitiv.

Renowned as the largest producer of memory chips globally, utilized in a range of products from laptops to servers, Samsung is also a dominant force in the smartphone industry.

Following the news, Samsung’s shares experienced a notable surge of 3.16% on Wednesday, emerging as the primary gainer on the South Korean Kospi, driving the index to lead gains in the Asian market.