Samsung mentioned on Thursday it expects part shortages to have an effect on chip demand from some prospects within the present quarter, after reporting its highest quarterly revenue in three years. The warning comes as producers of products from televisions to vehicles have confronted a bunch of provide chain points starting from a scarcity of logic chip components, manpower shortages, logistics snarls, and delays at components crops on account of energy cuts in China.
“An extended-than-expected part provide concern could must be monitored on account of potential impacts” on the manufacturing of gadgets that use reminiscence chips, Samsung mentioned in an announcement, though it added there was “sturdy elementary demand for servers from elevated investments from expertise corporations.”
The world’s prime maker of reminiscence chips and smartphones posted a 28 p.c soar in working revenue within the July-September quarter to KRW 15.8 trillion (roughly Rs. 1,01,090 crore) on the again of an 82 p.c on-year revenue surge in its chip enterprise, the place earnings rose to KRW 10.1 trillion (roughly Rs. 64,620 crore).
Rising reminiscence chip costs and shipments, plus a soar in profitability at Samsung’s chip-contract manufacturing enterprise boosted the chip enterprise’ working revenue.
Samsung mentioned demand for server DRAM chips, which quickly save knowledge, and NAND flash chips that serve the information storage market, is anticipated to remain sturdy within the fourth quarter on account of growth of information centre investments, whereas private pc manufacturing development is anticipated to carry in step with the earlier quarter.
Though provide chain points might restrict demand from some cell chip prospects within the fourth quarter, demand for server and private pc chips is anticipated to be sturdy in 2022 regardless of uncertainties, it mentioned.
Samsung didn’t touch upon the outlook for reminiscence chip costs, which has weighed on the corporate’s shares as buyers anticipate costs to have peaked within the third quarter earlier than falling till mid-2022.
Smaller rival SK Hynix on Tuesday struck a extra bullish observe than US friends and forecast regular demand for reminiscence chips. Earlier, chipmakers Intel and Micron had mentioned shortages of some elements have been stopping their prospects from delivery PCs.
Working revenue at Samsung’s cell division slid about 24 p.c on-year to KRW 3.36 trillion (roughly Rs. 21,495 crore) on the third quarter, as gross sales of Samsung’s new foldable smartphones have been tempered by advertising and marketing prices.
Regardless of uncertainties over part provide, year-end vacation buying is anticipated to spice up demand for cell gadgets within the fourth quarter, and Samsung goals to keep up a double-digit revenue margin within the cell enterprise by promoting extra foldable telephones and different premium fashions in addition to wearable equipment.
Web revenue rose 31 p.c to KRW 12.3 trillion (roughly Rs. 78,700 crore). Income rose 10 p.c to a report KRW 74 trillion (roughly Rs. 4,73,450 crore).
Samsung’s shares rose 0.3 p.c in early commerce on Thursday, in contrast with the broader market’s 0.1 p.c rise. It shares have fallen about 13 p.c year-to-date.
© Thomson Reuters 2021
