Samsung has been going through tough times due to the downturn of the semiconductor chip segment, leading to huge losses for the company. However, it looks like the company is recovering from that downturn and narrowing losses in its semiconductor chip business. Samsung has reported earnings guidance for Q3 2023, revealing better-than-expected results. Its profits are still low compared to the year earlier, but they have improved compared to the previous quarter.
Samsung's semiconductor business losses narrowed, and the smartphone division helped gain profits in Q3 2023
In its earnings guidance, Samsung Electronics reported that its revenue could be around KRW 67 trillion ($50.07 billion), with profits reaching around KRW 2.4 trillion ($1.79 billion). That's a 77% drop in operating profit compared to Q3 2022 but a massive (400%) improvement compared to the KRW 0.6 trillion (around $459 million) it managed to muster in Q2 2023. Its sales are still a 12% year-over-year drop, but that's likely to change in the coming quarters as experts expect a rebound in semiconductor chip demand. Samsung reduced its semiconductor chip production over the past few months to narrow losses.
In Q2 2023, Samsung posted its worst profit in 14 years and its first loss in the semiconductor chip division in its history. Its profit declined 95% in Q1 of this year, and that remained at a 96% drop in Q2 of the year. Thankfully, the losses from the semiconductor division narrowed, and Samsung's smartphone division (Samsung MX) helped the company achieve decent profits. The launch of the Galaxy Z Flip 5 and the Galaxy Z Fold 5 helped the company from dropping into the red.
Samsung Display, which makes OLED panels for smartphones and TVs, also seems to have recorded good profits, thanks to the launch of the iPhone 15 series, which uses OLED panels from Samsung. The South Korean firm will announce its full Q3 2023 earnings report by the end of this month.