Samsung Electronics said on Tuesday it expected demand for artificial intelligence to hold strong in the second half, driving sales of memory chips and tech devices, as it reported a more than 10-fold rise in first-quarter operating profit.
The South Korean company's memory chip sales nearly doubled in the first quarter from a year earlier as prices rose steeply from a severe downturn, thanks to the boom in AI.
"In the second half of 2024, business conditions are expected to remain positive with demand - mainly around generative AI - holding strong, despite continued volatility relating to macroeconomic trends and geopolitical issues," Samsung said in a statement.
The world's biggest maker of memory chips and TVs said operating profit rose to 6.6 trillion won ($4.8 billion) in January-March, up from 640 billion won a year earlier.
That was in line with Samsung's own estimate of 6.6 trillion won flagged earlier this month, its highest operating profit since the third quarter of 2022.
It cemented a recovery from an unprecedented memory chip downturn caused by weak post-pandemic demand for gadgets that use chips.
The chip division, historically Samsung's cash cow business that used to make up two-thirds of the company's operating profit, swung to profit of 1.91 trillion won in the March quarter from a 4.58 trillion won loss a year earlier.
First-quarter revenue rose 13% to 71.9 trillion won, the company said, including a 96% increase in memory chip revenue to 17.49 trillion won.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
