Samsung Elec may report a 3-year Q1 best when it releases guidance Wed

Samsung Electronics Co. is estimated to have kept up profit and sales around the levels of the last first-quarter peak of 2018 during chip boom period during the first three-month period despite disruption at its Austin plant.

A consensus estimate compiled by Seoul-based financial market tracker FnGuide on Monday put the company’s profit at 8.8 trillion won ($7.8 billion) in operating profit for the January-March period on sales of 60.8 trillion won. That would be 37 percent and 9.91 percent higher, respectively, from the same period a year earlier, but slightly off from 9.05 trillion won profit on sales of 61.55 trillion won in the previous three-month period.

Samsung Electronics releases its preliminary first-quarter guidance Wednesday morning.

Some analysts believe the first-quarter will exceed the October-December figures.

Hi Investment & Securities estimated 9.5 trillion won, Cape Investment & Securities 9.3 trillion won, Samsung Securities and Eugene Investment & Securities 9.2 trillion won, and Shinhan Investment 9 trillion won.

Foreign analysts agree.

Estimates drawn from 16 analysts by Reuters showed that the electronics giant reporting a 45 percent on-year jump in profit in the first quarter. That would make Samsung Electronics report 9.3 trillion won in operating profit, the highest since the first quarter of 2018.

The consensus estimates for the sales was 61.96 trillion won, up 12 percent on year thanks to robust sales of smartphones, TVs and home appliances.

TVs, premium appliances and latest smartphone series would have offset setbacks in chip business in the quarter.

“The company’s chip division may report weak numbers due to the production setback in Texas caused by unusual winter storm and the slower than expected rise in average selling price but the mobile operation should have made up for the losses with solid sales and operational cost cut,” said Song Myung-seop, analyst at Hi Investment & Securities.

According to Counterpoint Research, Samsung Electronics occupied 23 percent of the global smartphone market in the first quarter, up 3 percentage points from a year ago. The company’s smartphone division is expected to have generated 4.15 trillion won profit, as its new flagship Galaxy S21 series have fared well since its release in mid-January while high-profit accessories including Buds wireless earphones showed robust sales growth.

Profits from TV and home appliance operations are estimated at 1 trillion won, more than doubled compared to a year ago, propelled by the revived consumer demand.

The mainstay semiconductor division is likely have recorded 3.6 trillion won for the first-quarter profit, down 20 percent on year, largely due to the production suspension at its factory in Texas, the U.S. caused by an unusual winter storm. Its factory has returned to normal production since late March, according to the company.

The stock ended Tuesday 0.7 percent higher at 86,000 won in Seoul. It has been hovering around 82,000 won for months after slipping from the intraday peak of 96,800 won on Jan. 11.

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