In anticipation of Samsung Electronics publishing its Q3 earnings guidance later this week, market watchers expect the company to post an operating profit loss of nearly 80% on-year. Samsung's biggest loss is attributed to its semiconductor business, which continues to experience difficulties in the current market climate.
Analysts polled by the London Stock Exchange Group (LSEG) say Samsung Electronics' operating profit for Q3 2023 will be around 2.3 trillion won ($1.7 billion), with revenues of around 67.8 trillion won ($50 billion).
These figures represent a 78.7% yearly decline in operating profit and an 11.6% decline in revenue (via CNBC). Market watchers estimate that Samsung's semiconductor business may have experienced the biggest losses in Q3. Samsung Semiconductor is likely to post a quarterly loss of more than 3 trillion won ($2.2 billion).
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Samsung may record growth in other areas
Samsung Semiconductor may have experienced this Q3 decline as the memory market hasn't recovered as much as the company had hoped. The global semiconductor market continues to be affected by low demand and oversupply.
Last quarter, Samsung announced a 95% on-year operating profit decline, likewise mostly due to weak performance recorded by the semiconductor arm.
Despite these losses, market watchers estimate that Samsung's display and mobile units will post quarter-on-quarter growth in Q3 2023.
Samsung Display may see a rise in revenue thanks to its profitable business with Apple. The company supplied the latest iPhone 15 series with OLED panels. The iPhone lineup consists of four models, and Samsung Display is reportedly the only iPhone 15 panel supplier, as BOE failed quality tests.
In addition, analysts believe that Samsung's mobile business (Samsung MX) should see improved margins thanks to the foldable phones it unveiled in July, i.e., the Galaxy Z Fold 5 and the Galaxy Z Flip 5. The Z Fold and Z Flip lineups remain the most popular foldable phones worldwide, and slowly but surely, the consumer market is warming up to this new category of premium devices.