Samsung Electronics distinction superintendence misses expectations as won weighs

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SEOUL (Reuters) – Samsung Electronics Co Ltd (005930.KS) on Tuesday estimated a record fourth-quarter distinction though a superintendence fell brief of marketplace expectations as a clever won and one-off staff bonuses took a gleam off surging DRAM chip prices.

The tellurian memory chip personality pronounced a October-December handling distinction approaching jumped 64 percent year-on-year to 15.1 trillion won ($14.1 billion), bashful of a 15.9 trillion won normal guess from 17 analysts surveyed by Thomson Reuters. Revenue was estimated during 66 trillion won, somewhat next expectations.

While a superintendence put a South Korean tech hulk on march for a record 2017 profit, Samsung shares fell as most as 2 percent amid doubts over a opinion for memory chips and smartphones. The broader marketplace .KS11 was 0.3 percent higher.

“The banking outcome and bonuses seem to be a categorical reason for blank marketplace forecasts, though smartphone shipments are also approaching to be reduce than expected,” pronounced Song Myung-sup, researcher during HI Investment Securities.

“Considering Apple and Chinese firms’ sales weren’t stellar either, altogether mobile direct appears to have been sluggish.”

The clever won and a end-year reward for staff in a semiconductor business are approaching to have dented fourth-quarter distinction by about 400 billion won and 400-500 billion won respectively, dual analysts said.

Based on a guidance, Samsung’s 2017 handling distinction is approaching to come in during 53.6 trillion won, compared to a prior year’s 29.2 trillion won.

The Apple Inc (AAPL.O) smartphone opposition did not elaborate on a October-December opening and will divulge minute formula during a finish of January.

The final time a Samsung superintendence matter unhappy a marketplace was in a arise of a annoying withdrawal of a fire-prone Galaxy Note 7 handsets in Oct 2016.

MEMORY AND MOBILE

The continued arise in a cost of DRAM chips and direct from information core servers gathering fourth-quarter earnings, offsetting a dump in NAND chip prices and a stronger won, analysts said.

But a opinion for semiconductors in 2018 is mixed, and Samsung shares have depressed 11.4 percent from their all-time high in early Nov as some investors gamble on an finish to a memory boom.

NAND peep memory chips, used in things like digital cameras and USB drives, have entered a down-cycle and there is a perspective among some attention observers that DRAM marketplace conditions also will alleviate after this year.

Others however design DRAM supply to sojourn parsimonious via 2018 as Google (GOOGL.O), Amazon (AMZN.O) and Facebook (FB.O) enhance information centers used for cloud storage and computing.

The opinion for smartphones and other mobile devices, that analysts design to minister about 17 percent to Samsung’s fourth-quarter earnings, is also capricious due to foe from Chinese rivals in markets like Europe and Asia.

Tom Kang, investigate executive during information provider Counterpoint, pronounced Samsung’s mobile multiplication should uncover “moderate” conveyance expansion of about 1-2 percent in 2018.

South Korean exporters like Samsung will be gripping a tighten eye on a won KRW=KFTC in 2018. The banking traded on Monday during a top in some-more than 3 years.

($1 = 1,067.7000 won)

Reporting by Joyce Lee; Editing by Stephen Coates

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