Analyzing Samsung's Q2 Expectations

Anusuya Lahiri
2 min read
0
In this article:

  • Samsung Electronics Co, Ltd (OTC: SSNLF) announced its earnings guidance for the second quarter of 2022.

  • Samsung expects consolidated sales of 77 trillion Korean won, up 20.9% year on year (versus actual sales of 63.67 trillion Korean won in Q2 2021).

  • It expects a consolidated operating profit of 14 trillion Korean won, up 11.4% Y/Y (versus an actual operating profit of 12.57 trillion Korean won in Q2 2021).

  • Also Read: US Canvasses Netherlands To Severe Chipmaking Ties Between ASML And China: Pros And Cons

  • Chipmakers like Samsung and Taiwan Semiconductor Manufacturing Company Ltd (NYSE: TSM) see a demand correction from the pandemic and government stimulus-induced demand surge for electronic gadgets.

  • The Ukraine crisis and inflation also have restricted consumer spending on items.

  • The industry expects a challenging second half (as voiced by Advanced Micro Devices, Inc (NASDAQ: AMD) and Micron Technology, Inc (NASDAQ: MU)) as inflation restricts consumer spending for gadgets and the cryptocurrency market declines.

  • According to Counterpoint Research, Samsung will likely have shipped 62 million - 64 million units in Q2, down from the previous estimates of 68 million smartphones.

  • Piper Sandler saw DRAM, and NAND pricing decline, affecting Micron as mobile and notebook end-markets face continued weakness based on inSpectrum's June monthly memory contract pricing data.

  • Analysts saw server chip demand as the only bright spot, Reuters reports.

  • Amazon.com Inc  (NASDAQ: AMZN), Microsoft Corp (NASDAQ: MSFT), Alphabet Inc's (NASDAQ: GOOG) (NASDAQ: GOOGL) Google and Meta Platforms Inc's (NASDAQ: META) continued chip purchase to meet cloud demand so far helped to shield Samsung's profits.

  • Price Action: TSM shares traded higher by 3.23% at $78.00 in the premarket on the last check Thursday. MU shares traded higher by 1.34% at $58.14, and AMD shares traded higher by 1.34% at $76.36.

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