"Samsung Electronics' Operating Profit Surpasses 26 Trillion Won... Strong Earnings to Continue in Q1" — Yuanta Securities Korea Co., Ltd.

[Financial News] After Samsung Electronics Co., Ltd. posted its highest-ever quarterly operating profit in the fourth quarter of last year, the company is expected to extend its "earnings surprise" into the first quarter of this year, backed by strong memory semiconductor prices. In particular, sharp increases in the average selling prices (ASP) of DRAM and NAND flash are driving profit growth in the semiconductor division.
According to Yuanta Securities Korea Co., Ltd. on the 12th, Samsung Electronics Co., Ltd.'s earnings for the first quarter of this year are projected to reach 112.4 trillion won in revenue and 26.7 trillion won in operating profit. These figures represent year-on-year increases of 42.1% and 299.7%, respectively. The brokerage firm analyzed that the sharp rise in the average selling prices (ASP) of memory semiconductors will be the main driver of profit expansion.
For DRAM, the ASP is forecast to rise 15% quarter-on-quarter, with shipment volume increasing by 1%. For NAND flash, prices and shipment volume are expected to climb by 20% and 7%, respectively.
Baik Gil-hyun, an analyst at Yuanta Securities Korea Co., Ltd., said, "For DRAM, shipment growth will be limited due to process miniaturization, but the rise in ASP will lift earnings," adding, "The price upcycle is likely to continue as demand for high-capacity servers coincides with inventory restocking demand for consumer IT products."
In the fourth quarter of last year, Samsung Electronics Co., Ltd. posted consolidated revenue of 93 trillion won, up 22.7% from a year earlier and 8.1% from the previous quarter. Operating profit came in at 20.2 trillion won, a 208.4% jump over the same period, marking the company’s highest-ever quarterly performance. The operating profit margin (OPM) reached 21.5%.
The main driver of these results was the memory semiconductor division. DRAM prices rose 38% quarter-on-quarter and NAND prices climbed 29%, significantly boosting profitability even without an increase in shipment volume. By contrast, the System LSI and foundry divisions each posted operating losses in the 900 billion won range, reflecting weaker performance.
In the non-semiconductor segment, Samsung Display Co., Ltd. recorded operating profit of 1.2 trillion won, supported by stronger smartphone demand in North America. Its operating profit margin was around 15%.
moving@fnnews.com Lee Dong-hyuk Reporter