Business
Samsung’s Q2 profit raised by 38%, thanks to strong chip demand
Samsung has been doing quite well over the past year despite the COVID-19 pandemic. Today, the company remained to see a 38% increase in profits for the April-June quarter due to strong prices and demand driven by a pandemic-led consumer electronics and investment returns on data centers.
The profitability of the world’s largest chipmaker and smartphone maker is likely to exceed 11.3 trillion won ($10 billion). The strong performance of the South Korean technology company comes despite shipping fewer smartphones than it did in January-March and the demand for finished chip storage technology with full production capacity.
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Talking about the prices of DRAM chips, which are widely used on servers, mobile phones, and other computer devices, jumped 27% compared to the March quarter, while those of NAND flash chips operating in the data storage market increased by 8.6%, according to research provider Trendforce.
Profits have also improved in Samsung’s chip-contract and logic chip design business, in part because the operations of its storm-hit Texas industry have returned to normal, analysts say. They estimate that the chip division’s operating profit in April-June increased by about 22% from last year to about 6.6 trillion winners.
However, Samsung smartphone shipments dropped by 59 million in April-June from 76 million in the first quarter, as sales declined with its latest model, launched in mid-January.
The declining demand from India, which has been hit hard by the epidemic quarterly, and the tight supply of other chip processor processors are also likely to affect shipping, analysts say, estimating the mobile phone business’s operating profit of about 2.9 trillion winners.
Samsung ranked first in market share in the global smartphone market in Q3, 2023. TrendForce report says that Samsung led the global Q3 smartphone market, recording a market share of 19.5%.
Overall production in the third quarter increased by 11.5% compared to the previous quarter to 60.1 million units. During the same period, Apple’s production increased by 17.9% to 49.5 million, thanks to iPhone 15.
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Third place was taken by Xiaomi (13.9%), followed by Oppo (12.6%) and Transion (8.6%). 6th place is Vivo (8%). Meanwhile, global smartphone production reached 308 million units, a 13% increase compared to the previous quarter and a 6.4% increase from the previous year.
Huawei’s re-entry into the flagship smartphone market targeting Apple has had a significant impact in China. Huawei is aiming to expand its high-end flagship series, focusing on the Chinese domestic market next year, so Apple “We plan to attack directly”.
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In Q3 2023, Samsung and Apple’s market share slightly declined, while an underdog Chinese phone brand appeared on the top 5 chart. In a recent development, Canalys published market research data for the third quarter, revealing Tanssion as the fifth best-seller globally.
According to the info, Samsung and Apple lead total sales with 20% and 17% market share, yet both have fallen from their 22% and 18% levels in 2022. However, Tanssion, the maker of Tecno, Itel, and Infinix phones, climbed from 6% global market share last year to 9% in 2023, a 50% jump.
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Apart from this, Xiaomi matched last year’s share only by “recovering” from a terrible first half of 2023. At the same time, OPPO has fallen steadily over the past two years, while fellow BBK brand vivo lost the top-5 slot it’s owned for years.
Overall, the global smartphone market underwent a slight drop of 1% in Q3 2023. Bolstered by regional recoveries and new product upgrade demand, the smartphone market recorded a double-digit sequential growth in Q3, ahead of the sales seasons.
Recently, research agency Counterpoint Research published their latest analysis. The report reveals that Samsung continued its leadership in the third quarter of 2023, while Apple remained in the second spot. However, both OEMs faced a decline of 1 percent year over year.
According to CR, slower consumer demand is the main factor in the dwindling sales. The market did see a slight 2 percent growth in Q3 compared to Q2, likely driven by last month’s iPhone 15 series launch. Samsung secured 20 percent market share, while Apple grabbed 16 percent sales.
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The Galaxy A-series was the key driver for the South Korean smartphone maker. Apple came in second with 16 percent of the market while Xiaomi rounded out the top three with its 12 percent share. Oppo (10 percent) and vivo (8 percent) were the remaining brands in the top five charts.
The newly released iPhone 15 series will help Apple score a lead over Samsung in the fourth quarter of the year. The results will arrive by early next year, and it’s expected that the US phone maker could surpass Samsung. Major camera upgrades and USB-C helped Apple register strong sales.