Samsung sees stable Q1 profits despite COVID-19 pandemic
Samsung Electronics expects an operating profit of 6.4 trillion won and revenue of 55 trillion won for the first quarter of 2020, the company said in its earnings guidance on Tuesday.
It is a rise of 2.7% and 5%, respectively, compared to a year ago, and slightly better than the market consensus of South Korean analysts.
The effect of the global COVID-19 pandemic on the South Korean tech giant's bottom line seems minimal, for now, as the outbreak began in earnest in March in the US and Europe, but uncertainties remain high for the second quarter.
Samsung launched the Galaxy S20 series in late February and initial sales of the device likely helped despite slower sales compared to its predecessor, the S10 series.
But overall smartphone sales, as well as those in TV and home appliances, are expected to be sluggish for the next quarter. A recovery in Samsung's semiconductor business however, thanks to rising demand for server memory, is likely to offset these drops.
Samsung is expected to announce its full quarterly report at the end of the month.
Last month, the company said in its annual shareholders' meeting that it expects the smartphone market to contract this year but demand for 5G handsets would grow, while the memory market is expected to stabilise.
Co-CEO HS Kim, however, warned at the time that it was "yet to fully determine how COVID-19 will impact distribution and consumers."
"We will conduct research further to prepare for it," he said.
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