AI-powered flagship Galaxy S24 smartphones and semiconductors boost Samsung Electronics (Samsung) first-quarter revenue, posting a consolidated revenue of KRW 71.92 trillion.
Samsung’s operating profit saw a significant increase, reaching KRW 6.61 trillion, driven by the resurgence of the Memory Business into profitability, catering to demand for high-value-added products.
The Mobile eXperience (MX) Business also contributed to the positive earnings trend, alongside increased profitability in the Visual Display and Digital Appliances segments.
Samsung’s investments in the first quarter totaled KRW 11.3 trillion, with KRW 9.7 trillion allocated to the Device Solutions (DS) Division and KRW 1.1 trillion to Samsung Display Corp. (SDC). Memory-focused expenditures address the demand for advanced products like High Bandwidth Memory (HBM) and DDR5, while foundry investments aim to meet future demand.
Against the backdrop of a strong Q1 performance, Samsung is hoping to continue the trajectory in the second quarter, banking on sustained demand for Generative AI (GenAI), particularly in servers and storage. However, the company said PC demand may experience a seasonal slowdown, prompting inventory adjustments ahead of anticipated new product launches later in the year.
Still, Samsung remains cautiously optimistic about its future prospects, acknowledging potential challenges amid market uncertainties but expressing confidence in its ability to navigate them effectively.
The DS Division reported consolidated revenue of KRW 23.14 trillion and operating profit of KRW 1.91 trillion for the first quarter. The Memory Business returned to profitability by focusing on high-value-added products such as HBM, DDR5, and server SSDs.
Second quarter
“The System LSI Business faced challenges due to slowing panel demand but anticipates business conditions to improve in the second half of 2024,” the company said.
The Foundry Business saw delays in sales improvement but Samsung is optimistic about rebounding in the second quarter, driven by efficiency gains and the development of advanced technologies like 3nm and 2nm.
SDC, with a consolidated revenue of KRW 5.39 trillion, faced competition in the mobile display segment but aims to capitalize on new opportunities in foldable phones and IT products. The company plans to enhance its large display sales by improving production efficiency and focusing on high-value-added offerings.
In the second half of the year, SDC intends to boots its business portfolio by expanding sales of flexible displays and tapping into the IT and automotive sectors.