Samsung Electronics recorded an operating profit of over 6 trillion won in the first quarter of this year. This far exceeded market expectations, which had anticipated a figure around 5 trillion won. The world's first artificial intelligence (AI) phone, the Galaxy S25 model, received an enthusiastic response from consumers and saw strong sales, while DRAM shipments also performed well, driving the company's results. However, with the onset of the U.S. tariff hike starting this month, it is uncertain whether the strong first-quarter performance, led by smartphones, will continue into the second quarter.

On the 8th, Samsung Electronics announced in a regulatory filing that its consolidated operating profit for the first quarter (January to March) was 6.6 trillion won, a 0.15% decrease compared to the same period last year. Revenue reached 79 trillion won, up 9.84% year-on-year. This marks the highest first-quarter revenue in the company's history and the second highest for any quarter, following the record 79.1 trillion won in the third quarter of last year.

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This announcement is based on preliminary results, so detailed breakdowns by business division were not disclosed. However, analysts in the securities industry estimate that the Mobile Experience (MX) division, responsible for smartphones, generated over 4 trillion won in operating profit. The MX division's Galaxy S25 series, launched in February, achieved domestic sales of 1 million units in just 21 days, the fastest ever for a Galaxy series.

The Device Solutions (DS) division, which handles the semiconductor business, is estimated to have recorded an operating profit of around 1 trillion won. The foundry (semiconductor contract manufacturing) and System LSI divisions have not yet escaped losses, and a decrease in high-bandwidth memory (HBM) sales volume is expected to have significantly reduced operating profit.

However, it appears that recent trends in the Chinese market, where Samsung Electronics has been focusing its memory sales, helped offset some of the DS division's losses. Due to China's "Yi Jiu Huan Xin" (trade-in old products for new ones) policy, smartphone demand increased by 15% year-on-year, leading to higher-than-expected demand in memory-related industries and a significant improvement in memory inventory. In addition, proactive increases in shipment volume in anticipation of the Trump administration's "tariff bomb" likely had a positive impact on Samsung's DRAM shipments.

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Kim Sunwoo, an analyst at Meritz Securities, cited the effect of early smartphone shipments as the main reason behind Samsung Electronics' "strong first quarter." Kim said, "Based on solid smartphone shipments, results exceeded market expectations," adding, "It is also important to consider the extremely low base effect for semiconductor profit expectations."

He further predicted that the second quarter results may be weak due to the full implementation of the Donald Trump administration's tariff policies. Although a rise in memory prices is expected in the market, ongoing sluggish market conditions and the possibility that mobile sales, which were brought forward due to tariff concerns, could drop again are causes for concern.

Samsung Electronics Seocho Building, Seocho-gu, Seoul. Yonhap News

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Kim added, "With no clear signs of improvement in the semiconductor division expected in the second quarter, the company's overall operating profit is likely to remain at a similar level to the first quarter. Unless there is a significant increase in shipments of major HBM products, the company's overall results could decline quarter-on-quarter depending on the extent of the MX division's profit decrease."