AI drives sales and profits at Samsung

July will see next generation of Fold and Flip smartphones and Galaxy Ring

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Samsung Galaxy Z Flip 5

Samsung Electronics experience a 10-fold increase in operating profit in the first quarter. Sales of memory chips from the South Korean company nearly doubled in the first quarter from a year earlier, when prices rose sharply after a severe downturn.

Operating profit rose to 6.6 trillion won (€3.2 billion) in January-March, up from 640 billion won a year earlier.

Sales in the first quarter rose 13% to 71.9 trillion won, of which memory chips accounted for 17.49 trillion won.

The chip division has historically been Samsung’s biggest revenue maker, accounting for a profit of 1.91 trillion won.

Prices of NAND Flash chips used to store data rose 23% to 28% in the first quarter compared with the previous quarter, while prices of DRAM chips used in tech devices rose about 20%, according to TrendForce data.

Samsung’s mobile device business posted an operating profit of 3.51 trillion won in the first quarter, down from 3.94 trillion won a year earlier. Rising costs, including higher prices for memory chips, squeezed the margins of Galaxy S24 smartphones launched in the quarter.

Samsung is expected to announce the Galaxy Z Flip6 and Galaxy Z Fold6 and showcase the first Galaxy Ring, which monitors health at its next Unpacked event. The ring was already demoed at Mobile World Congress.

The overall smartphone market rose 7.8% in the first quarter, with a total of 289.4 million shipped to winkles. At 20.8%, Samsung is back in first place, followed by Apple at 17.3%.

Rival LG Electronics Inc. (LG) announced consolidated revenue of $15.31 billion and operating profit of $965.3 million for the first quarter of 2024. The home appliances sector achieved record sales and double-digit operating profit margins. The EV components sector continued its steady growth.

LG Home Entertainment Company reported first-quarter sales of $2.5 billion and an operating profit of $96 million thanks to a rebound in demand for TVs in Europe and the launch of the new 2024 models.

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