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Samsung returns to the forefront with profits multiplied by 10

© Unsplash/Jonathan Kemper

Samsung is finally coming out of the bad patch that weighed down its revenues during 2023. If revenues from smartphones were saved by premium products, which were not affected by the falling demand, those from memory chips (Samsung's other main source of revenue) were in free fall. Indeed, Samsung has suffered a drop in memory chip prices, caused by excess inventory and a drop in demand for electronic devices, such as PCs or smartphones, that use these chips.

However, in the first quarter of 2024, Samsung is doing significantly better. While awaiting the presentation of its quarterly results, the Korean giant has just published quarterly results. It estimates its operating profit for the first quarter at 6.6 trillion won, the equivalent of 4.77 billion euros. Compared to the operating profit for the first quarter of 2023, this corresponds to an increase of 931%.

As for revenues, these are up 11.4%. And although these did not exceed analysts' forecasts, the fact that Samsung's operating profit increased almost 10 times signals that the situation is clearly improving in the memory chip market. In addition, at the beginning of the year, Samsung successfully launched its new flagships on the smartphone market: the Galaxy S24 series.

A situation which is normalizing ?

According to Bloomberg, before the publication of these preliminary results, Kyung Kye-hyun, the boss of the memory chip activity of Samsung, had already mentioned a normalization of the situation. During a meeting with shareholders, he predicted that Samsung's memory chip business should return to its 2022 performance this year.

In addition, this Samsung activity could benefit from the boom in artificial intelligence. Indeed, if Nvidia is the main manufacturer of GPUs used to train and run AI models like ChatGPT, Samsung could become the main supplier of memory chips for this technology. Recently, Nvidia boss Jensen Huang reportedly praised Samsung's high-bandwidth memory chips, suggesting that Nvidia could source from the Korean giant.

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  • In 2023, Samsung posted very poor results, due to the drop in memory chip prices
  • But, in the first quarter of 2024, the Korean giant comes out of this bad situation
  • According to preliminary results, its operating profit increased by 931% YoY
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    Teilor Stone

    By Teilor Stone

    Teilor Stone has been a reporter on the news desk since 2013. Before that she wrote about young adolescence and family dynamics for Styles and was the legal affairs correspondent for the Metro desk. Before joining Thesaxon , Teilor Stone worked as a staff writer at the Village Voice and a freelancer for Newsday, The Wall Street Journal, GQ and Mirabella. To get in touch, contact me through my teilor@nizhtimes.com 1-800-268-7116