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How Will Q1 Earnings Guidance Affect Samsung's Stock?

Samsung released its Q1 2021 earnings guidance on Wednesday, and reported a likely profit increase of 44% over the same quarter last year. Quarterly sales also rose 17.5%, primarily from smartphones and home appliances. Still, Samsung’s stock price was trading down by nearly 0.5% on Wednesday morning.

samsung

Samsung (SMSN-L) noted that its operating profit for the quarter reached $8.3 billion, while its sales figures stood at $58 billion. Much of this growth was led by the company’s mobile division. Sales were particularly strong for the Samsung Galaxy 21 series of smartphones, which came out in January. This may have been affected by the line’s release date, which was moved up a month when compared to previous launches. Galaxy sales have helped Samsung keep the number two spot in the global smartphone market, with a 15% share, right after Apple (AAPL) who is the world’s premier smartphone seller, with 19% of the global market.

The company also saw significant growth from its consumer electronics division, which markets televisions and home appliances. Demand for these goods, along with high-margin wearables such as Galaxy Buds, rose, possibly because more consumers stayed home due to pandemic-related lockdowns. 

Samsung Semiconductor Division Sees Lowest Profit in Years

One Samsung division that did not fare as well in Q1 was the semiconductor line. Samsung, the world’s largest memory chip maker, was forced to suspend operations at the production foundry in Texas where it manufactures chips for other companies, after a serious winter storm hit the area.

The plant, which supplies 5% of the world’s memory chips, lay idle for more than a month during a period where semiconductors were already in short supply. These ongoing delivery issues have already resulted in Samsung being called to a meeting with President Biden on Monday regarding America’s microchip supply chain. Currently, Samsung is the only non-U.S. manufacturer which has been invited to attend the meeting, possibly because its major offshore competitor, Taiwan Semiconductor Manufacturing Company (TSM), has already agreed to expand facilities in the United States.

While Samsung’s Q1 2021 earnings guidance paints a rosy picture, traders will need to wait for the company’s earnings release later this month to get the full scope of its performance.

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Esta información fue redactada por Plus500 Ltd. La información se proporciona solo con fines generales y no tiene en cuenta ninguna circunstancia u objetivo personal. Antes de actuar con base en este material, debe considerar si es adecuado para sus circunstancias particulares y, si es necesario, buscar asesoramiento profesional. No se ofrece representación ni garantía en cuanto a la exactitud o integridad de esta información. No constituye asesoramiento financiero, de inversión ni de otro tipo en el que pueda confiar. Cualquier referencia a desempeños pasados, rendimientos históricos, proyecciones futuras y pronósticos estadísticos no son garantía de rendimientos futuros o desempeños futuros. Plus500 no será responsable del uso que pueda hacerse de esta información y de las consecuencias que puedan resultar de dicho uso. Por lo tanto, cualquier persona que actúe basándose en esta información lo hará a su propia discreción. La información no ha sido preparada según los requisitos legales creados para promover la independencia de la investigación sobre inversiones.

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