Samsung Electronics on track for record third quarter as chips soar

Samsung Electronics on track for record third quarter as chips soar

The technology giant estimated operating profit for the third-quarter nearly tripled to 14.50 trillion Korean won or $12.8 billion from 5.20 trillion won previous year.

Samsung said its July-September profit was likely 14.5 trillion won ($12.81 billion), compared with an average forecast of 14.3 trillion won from a Thomson Reuters survey of 20 analysts.

The operating profit figure was slightly higher than the market's consensus of 14.3 trillion won, a number compiled by Yonhap Infomax, the financial arm of Yonhap News Agency, based on 21 local brokerage houses.

"It's the chip prices that are driving up the profit rather than the sales volumes", said Park Kang-ho, an analyst at Daishin Securities.

The South Korea electronics giant said it expects to record its biggest operating profit ever in the third quarter, thanks largely to continued strong demand for memory chips.

The results don't include net income or break out divisional performance. They have climbed more than 50 percent this year.

Samsung's mobile division saw its operating profit plunge to 100 billion won in the third quarter of 2016 due to the suspended production of the Galaxy Note 7, which recovered to 2.5 trillion won a quarter later.

Growing sales of organic light-emitting diode (OLED) smartphone screens for new Apple smartphones also have supported forecasts of a new earnings record in the fourth quarter. It's also seeking to release a phone with a bendable display next year to tighten the lead with Apple and fend off challenges from Huawei Technologies Co. Analysts said Samsung's strong earnings are attributable to increased shipments of chips. Lee was given a five-year jail term, although he has appealed the case. Samsung Electronics, of which he is a vice chairman and board member, is the crown jewel of a conglomerate comprised of about 60 units selling selling life insurance, cargo ships and clothes.

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