Samsung Electronics posted nearly double the estimated operating profit for the first quarter and registered its largest-ever jump in net profit mainly thanks to its semiconductor division ending its nine-month loss streak with its first profit since last year.
The world's largest maker of both smartphones and memory chips posted an operating profit of 6.6 trillion won ($4.8 billion) for the January-March period, nearly double from the same period last year.
Samsung said in a statement revenue increased 12.8 percent to 71.9 trillion won, and net income surged 329 percent to 6.75 trillion won, far from analysts' expectations of around 5.6 trillion won on average.
Samsung spent a record 7.82 trillion won in R&D in the first quarter, the most spent in any quarter so far.
For the three months, the semiconductor business itself raked in 23.1 trillion won in sales, with an operating profit of 1.91 trillion won, a reversal from the loss recorded in the fourth quarter of last year. It was the first profitable quarter since then, after recording a significant operating loss of over 15 trillion won during a slump in the global chip market.
The firm said a ramp-up in demand for memory chips, combined with rising prices for DRAM and NAND flash, drove the better quarterly results. The firm's steady sales of DDR5 products and large solid-state drives helped boost the performance.
Looking out to the second quarter, Samsung foundry operations are on track to show double-digit growth in the next quarter, after recovering from the first quarter. This is because, after inventory levels stabilized at customer end, production utilization has stepped up.
Samsung is also making headway in technology, continuing work to fully develop 2nm design infrastructure and improving capabilities in mature processes, such as 14nm and 8nm, to win more customers.
The mobile and other devices segment was able to make impressive revenues of 47.3 trillion won and an operating profit of 4.1 trillion won during the first quarter. The smartphone segment alone posted sales of 33.5 trillion won and operating profit of 2.5 trillion won.
Enhanced profits even amid global slowdown for smartphones with the introduction of the Galaxy S24 series, the first-ever AI-powered smartphone by the company.
The company also mentioned in its statement that it had shipped 60 million smartphones and 7 million tablets in the quarter with the average price of the smartphones being $336.
Although Samsung reported lower earnings than the last quarter, the company attributed demand for premium-priced QLED and OLED televisions to remain robust amid the global TV market downturn.
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