Samsung eyes boost in chip business
( AP ) -- South Korea's Samsung Electronics Co. expects strong demand and cost cuts to boost second-half profit in its chip business.
The profit margin for its NAND flash memory chips - used in digital consumer products like cameras and music players - is rising sharply, while that for DRAM, or dynamic random access memory chips used in personal computers, is increasing moderately, the company said in material prepared for a CLSA-sponsored investor relations meetings in Hong Kong.
Samsung, the world's largest maker of memory chips, expects the global NAND market to be more favorable in the first half of next year due to strong demand for high-density music phones and video MP3 players.
Samsung sees also a strong increase in shipments of its flat-panel TVs in the third quarter of this year and "even better" performance in the fourth.
Sales this year of liquid crystal display televisions are expected to double on year to 12 million units, it said.
Samsung reported in July that its net profit in the quarter to June 30 fell 5 percent from a year ago on price declines for computer chips. But it said then as well that a rebound in the market would bolster earnings.
Samsung earned 1.42 trillion won ($1.55 billion) in the second quarter, the company said in the July earnings report. Sales rose 3.7 percent during the quarter from the same period last year.
Shares of Samsung Electronics fell 2.2 percent to 534,000 Friday in Seoul. They are down 22 percent since hitting 687,000 the day the earnings report was issued.
The shares were boosted that day to their highest level for the year on a news report that U.S. investor Carl Icahn may be considering a bid for the company.