Published: Fri, October 13, 2017
Sci-tech | By Carrie Guzman

Samsung predicts record profits for third quarter as memory business booms

Samsung predicts record profits for third quarter as memory business booms

The company estimated operating profits of 14.5 trillion won ($12.8 billion) in the July-September period, a record for quarterly profit and almost three times the 5.2 trillion won earned a year earlier.

Operating profit was estimated at 14.5 trillion won (US$12.8 billion), compared with 5.2 trillion won tallied a year earlier, the company said in a regulatory filing.

The South Korean tech giant also said it expected consolidated sales to be about 62 trillion Korean won, a touch lower than the 62.1 trillion won market forecast.

Analysts said Samsung's chip business may have posted an operating profit of 10 trillion won in the third quarter, along with sales of 20 trillion won, putting the operating margin at above 50 percent. The company is set to release its final earnings report later this month. Samsung said that pre-orders for the phone were the highest-ever for its Note series.

Known as "Mr Chip", Kwon, 64, oversaw the growth of Samsung's component business which now generates much of the firm's profits, dwarfing earnings from smartphones and other mobile devices.

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It is also a 3 percent rise from this year's second quarter - its previous highest - of 14.07 trillion won in profits.

Industry watchers, meanwhile, said the absence of Samsung's top leaders cast a cloud over the company's long-term strategy. Vice Chairman and Chief Executive Officer Kwon Oh-hyun is stepping down after more than three decades at the company, saying that he's making way for new leadership amid a corruption trial surrounding the de facto chief.

Kwon is one of the two vice chairmen at Samsung Electronics with Jay Y. Lee, who was sentenced to five years in prison in August for bribing a presidential confidante in return for help in succeeding his hospitalized father, Chairman Lee Kun-hee.

Samsung's stock price briefly hit a record of 2.74 million won per share on Thursday, before rolling back slightly to 2.72 million won per share at the time of publication.

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