It would have been a lot better had it not for those pesky melting smartphones it released. The South Korean firm discontinued sales of the Galaxy Note 7 phones after some of the devices caught fire, warning of a $2.1 billion hit to its profit in the fourth quarter of 2016 due to expenses tied to an ongoing global recall and lost sales.
But a surge in sales of memory chips and organic light-emitting diode screens for smartphones will provide Samsung with a pile more cash than expected.
Samsung’s operating profit likely rose for a second straight quarter to $7 billion over October-December this is up 37 percent from a year ago, and the highest since the first quarter of 2014.
Memory chip prices have spiked recently on demand for more firepower on mobile devices. But it is the sales of the higher-end 3D NAND chips which have rallied significantly, helping Samsung rake in profits given it is ahead of its rivals such as Toshiba Corp and SK Hynix in the mass production of these chips.
Much depends on how badly the mobile business does with the incredible melting smartphone but most expect Samsung to make a huge profit this year.
For the recently ended quarter, Samsung’s mobile earnings likely rebounded from the dismal third quarter on healthy sales of the Galaxy S7 and S7 edge smartphones, analysts said.
Shares in the company have increased by 43 per cent in 2016 suggesting investors did not expect a serious business impact from Samsung’s name being dragged into a growing political scandal in the country.