According to several independent reports from insiders in South Korea, Samsung expects the Galaxy S8 and Galaxy S8+ to be its best-selling smartphones of all time. Sales of last year’s Galaxy S7 and S7 edge have reportedly topped 52 million units so far, which makes that quite a tall order. Considering how much buzz Samsung managed to stir up despite its Note 7 debacle, and considering how incredibly impressive the new Galaxy S8 and S8+ are, the company’s supposed 60 million unit target could be well within reach. And needless to say, these high-priced, high-margin phones will do wonders for Samsung’s bottom line.
But Samsung is much more than just a smartphone maker, and the company has one of its other key divisions to thank for the remarkable Q1 earnings it just reported.
Samsung on Thursday announced its audited first-quarter earnings, and they were nothing short of explosive. On the back of a huge performance boost in the company’s massive components division, Samsung posted a net profit of 7.68 trillion South Korean won (US$6.8 billion), a 46% increase from the year-ago quarter. In fact, Q1 2017 marked Samsung’s most profitable quarter in three years.
Revenue was up slightly to 50.55 trillion won in the March quarter, while operating profit ballooned to 9.90 trillion won, a 48% increase over the same quarter last year.
The company’s semiconductor division found the most success in Q1, raking in an operating profit of 6.31 trillion won on consolidated revenue totaling 15.66 trillion won. Samsung said improved sales of its NAND flash storage modules and DRAM memory chips had a big impact on Q1 performance, and it expects its semi business to continue to grow in the second quarter. Strong demand for Samsung’s display panels also contributed 1.30 trillion won in Q1 operating profit on 7.29 trillion in sales.
Samsung’s Mobile Communications and Networks Businesses, which now comprise its IM Division, pulled in 2.07 trillion won in operating profit on the back of revenue totaling 23.50 trillion won. Considering the April launch of its new Galaxy S8 and S8+ flagships in addition to continued strength in the company’s semi business, things may be looking even brighter for Samsung in Q2 2017.