Samsung Electronics to Post 'Record-Breaking Performance' in Q2... DRAM Prices Decline Less, Shipments Increase

Q2 Expected Earnings of 78.6158 Trillion Won... Forecasted to be Record High
Semiconductors Drive Growth... Account for Over 70% of Operating Profit
D-RAM Price Drop Less Severe Than Expected

There are expectations that Samsung Electronics' semiconductor performance in the second quarter of this year will once again break all-time records. This is because the decline in memory semiconductor prices was less severe than the market had feared. With the peak season for semiconductor sales in the second half of the year approaching, an increase in DRAM shipments is expected to drive strong performance.

According to industry sources and financial information provider FnGuide on the 10th, Samsung Electronics' estimated second-quarter results are sales of 78.6158 trillion KRW and operating profit of 15.2911 trillion KRW. In terms of projections, the sales figure is the highest ever on a quarterly basis, and the operating profit is the second largest since the semiconductor super boom in the first quarter of 2018.

The reason for the expectation of record-breaking results lies in semiconductors. Major securities firms forecast that Samsung Electronics will earn an operating profit of 11.4 trillion KRW from semiconductors alone in the second quarter. This accounts for more than 70% of the total operating profit.

In particular, the price of DRAM, Samsung Electronics' main semiconductor product, fell less than the market had feared, and shipments increased, directly impacting the performance. Additionally, both the price and shipment volume of NAND flash increased significantly, which is also cited as a cause.

According to market research firm DRAMeXchange, last month the fixed transaction price of DRAM (PC DDR4 8Gb standard) was $3.35, slightly down from $3.41 the previous month. DRAM prices have been on a downward trend since rising to $4.10 in July last year.

However, considering that the decline rate of the fixed transaction price of DRAM was expected to be 3-8% in the second quarter alone, the drop was smaller than the market's concerns. An industry official said, "The smaller-than-expected price decline helped us get through the traditionally slow first and second quarters well."

DRAM shipments have recently been increasing. This is analyzed to be due to a sharp rise in cloud investment demand this year from major big tech companies that had postponed such investments due to the COVID-19 shock. Server DRAM demand this year is predicted to increase by more than 27% compared to the previous year.

In fact, Meritz Securities predicted that Samsung Electronics' average selling price of DRAM in the second quarter would fall by 1% compared to the previous quarter, but shipments would increase by 15%. Based on this, Samsung Electronics is expected to record an operating profit of 11.4 trillion KRW from semiconductors alone in the second quarter. This would be the largest scale again following the first quarter. KB Securities also forecast that Samsung Electronics will record its highest-ever performance in the second quarter of this year.

Meanwhile, the World Semiconductor Trade Statistics (WSTS), a global semiconductor market research organization, forecasted that the semiconductor market size will grow significantly compared to the previous year. In particular, the growth rate of memory semiconductors is expected to reach 18.7%. This is a significant upward revision from the previous forecast in March, which predicted a growth rate of only 1.1% for this year.

This content was produced with the assistance of AI translation services.