Samsung Electronics Co reported a surge in first-quarter profit on strong sales of memory chips and premium smartphones, but cautioned of risks ahead from inflation and geopolitical uncertainty.
Net income increased more than 50 percent to 11.13 trillion won (US$8.8 billion) in the three months ended March. Analysts predicted 10.14 trillion won on average, estimates compiled by Bloomberg showed.
Still, Samsung repeatedly warned about the potential impact from the war in Ukraine, surging inflation and COVID-19 outbreaks that have led to lockdowns in China.
Photo: AFP
“It is an immense challenge to predict the duration or market ripple effects of various macro issues such as the Russian-Ukraine war and global inflation,” said Jinman Han, executive vice president for Samsung’s memorychip business.
The company, which declined to make a financial forecast for the year because of the many uncertainties, saw revenue last quarter rise to a record, boosted by soaring demand for semiconductors.
Samsung said its memory business exceeded its own guidance on bit growth, because of solid demand from servers and PCs. It is benefiting from device manufacturers adopting chips that have bigger storage and better performance.
Samsung said server demand is likely to remain strong, but short-term demand for mobile devices has suffered, because of lockdowns in major Chinese cities and rising commodity prices, in part because of the war in Ukraine.
“A surge in raw materials prices caused by the Russia-Ukraine war” is hitting the smartphone industry, Han said. “The consumer sentiment has potential to recover later in the quarter, with the launch of new form factor models, with people spending more time outside following gradual reopening in some countries, with the resumption of investment in 5G infrastructure.”
Samsung projected smartphone demand would rise in the second half of the year after a slight decline this quarter.
The firm said it benefited from the strength of the US dollar against the won, which outweighed weakness in some emerging currencies. That helped boost operating profit by about 300 billion won, it said.
It is also making an aggressive — and expensive — push into the foundry business, essentially manufacturing chips for companies like Apple and Google that have started designing their own silicon. It has set an aggressive goal to start producing 3-nanometer chips in the first half of this year, ahead of Taiwan Semiconductor Manufacturing Co’s (台積電) schedule.
Still, progress has come at a cost. Although its foundry sales are rising amid the global chip shortage, investors question Samsung’s capability to manufacture advanced nodes beyond 4 nanometers. Its foundry unit is grappling with slower-than-expected improvement in production yields at its advanced chipmaking process.
Taiwan Transport and Storage Corp (TTS, 台灣通運倉儲) yesterday unveiled its first electric tractor unit — manufactured by Volvo Trucks — in a ceremony in Taipei, and said the unit would soon be used to transport cement produced by Taiwan Cement Corp (TCC, 台灣水泥). Both TTS and TCC belong to TCC International Holdings Ltd (台泥國際集團). With the electric tractor unit, the Taipei-based cement firm would become the first in Taiwan to use electric vehicles to transport construction materials. TTS chairman Koo Kung-yi (辜公怡), Volvo Trucks vice president of sales and marketing Johan Selven, TCC president Roman Cheng (程耀輝) and Taikoo Motors Group
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
RECORD-BREAKING: TSMC’s net profit last quarter beat market expectations by expanding 8.9% and it was the best first-quarter profit in the chipmaker’s history Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), which counts Nvidia Corp as a key customer, yesterday said that artificial intelligence (AI) server chip revenue is set to more than double this year from last year amid rising demand. The chipmaker expects the growth momentum to continue in the next five years with an annual compound growth rate of 50 percent, TSMC chief executive officer C.C. Wei (魏哲家) told investors yesterday. By 2028, AI chips’ contribution to revenue would climb to about 20 percent from a percentage in the low teens, Wei said. “Almost all the AI innovators are working with TSMC to address the
FUTURE PLANS: Although the electric vehicle market is getting more competitive, Hon Hai would stick to its goal of seizing a 5 percent share globally, Young Liu said Hon Hai Precision Industry Co (鴻海精密), a major iPhone assembler and supplier of artificial intelligence (AI) servers powered by Nvidia Corp’s chips, yesterday said it has introduced a rotating chief executive structure as part of the company’s efforts to cultivate future leaders and to enhance corporate governance. The 50-year-old contract electronics maker reported sizable revenue of NT$6.16 trillion (US$189.67 billion) last year. Hon Hai, also known as Foxconn Technology Group (富士康科技集團), has been under the control of one man almost since its inception. A rotating CEO system is a rarity among Taiwanese businesses. Hon Hai has given leaders of the company’s six