Why the Impact of the Labor Union Strike on Samsung Electronics Is 'Limited' [Click e-Stock]

On May 7, Kyobo Securities assessed that the impact of the labor union strike on Samsung Electronics would be limited, given the continued boom in the memory business.

Choi Boyoung, an analyst at Kyobo Securities, stated in a report on this day, "Samsung Electronics' sales this year are projected to reach KRW 670 trillion, with operating profit expected at KRW 339 trillion." She added, "The union strike and temporary weakness in the non-memory segment are short-term variables, but considering the strength and persistence of the memory upcycle, their impact will be limited."

In the first quarter of this year, Samsung Electronics reported sales of KRW 133.9 trillion, a 69% increase compared to the same period last year, and operating profit of KRW 57.2 trillion, a 756% surge. This is the highest quarterly performance ever recorded, surpassing last year's annual operating profit in just one quarter.

Currently, demand for high bandwidth memory (HBM) is rising sharply due to increased investment in artificial intelligence (AI) data centers. At the same time, demand for DDR5 for general servers and mobile LPDDR5X is also strong, leading to a deepening supply shortage across the entire memory product lineup. NAND flash is also experiencing record-breaking quarterly sales, driven by growing demand for enterprise solid-state drives (eSSD) for data centers.

Analyst Choi remarked, "Beyond the absolute scale of profits, visibility and sustainability are emerging as key investment points," and added, "The expansion of long-term supply contracts and the full-scale rollout of HBM4 represent structural changes that enhance both variables simultaneously."

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