Tech Updates: Microsoft, Tesla, Amazon, and More PART 6 OF 6
Samsung’s operating profit likely to be the highest ever in fiscal 2Q17
Samsung Electronics (SSNLF) predicts that its 2Q17 operating profit will be its highest ever on the back of red-hot demand for its components.
The South Korean tech giant said it expects fiscal 2Q17 (the April to June quarter) operating profit of about $12.1 billion, a 72% increase of 8.1 trillion won, or $7.0 billion, from 2Q16. The company estimates that its revenue will be $51.9 billion in 2Q17, a sharp rise from the 2Q16’s revenues of $44.0 billion. The company’s earnings should be announced later this month.
The South Korean company’s previous all-time operating profit record came in 3Q13, when it posted $8.8 billion or 10.2 trillion Korean won. The forecast for 2Q17 was a stunning 37% higher than the 3Q13 figure. Samsung shares have surged 64% over the last year.
Samsung is still the leader in smartphones
As the graph above shows, Samsung remains the leader in the smartphone business, ahead of Apple (AAPL). According to IDC, the South Korean company has a 22.8% market share in the segment compares to 14.9% of Apple. However, both companies have faced stiff competition from Chinese phone makers like Huawei, Oppo, and Vivo in recent years. The recall of Samsung S7 cost the company a big chunk of revenues while also eroding consumer trust.
However, Samsung is surging in its chip-making segments. Analysts expect Samsung to surpass Intel (INTC) as the largest chip maker in terms of sales. Samsung has been pumping a lot of money into its semiconductor unit.