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Samsung flags weak mobile market as chip business booms

Samsung flags weak mobile market as chip business booms
01 May
5:05

Samsung has said that weakness in the global smartphone market would slow earnings growth, as it reported record quarterly profit on Thursday thanks to strong demand for semiconductors used in servers.

The world’s biggest maker of memory chips, smartphones and television sets also flagged softer demand for smartphone OLED panels as a challenge for the second quarter, while its cash-cow chip business should remain strong.

“Generating overall earnings growth across the company will be a challenge due to weakness in the display panel segment and a decline in profitability in the mobile business amid rising competition in the high-end segment,” the South Korean giant said in a statement.

Samsung Electronics shares were up 2.7 per cent, as of 0412 GMT, while the KOSPI benchmark share price index was 1.3 per cent higher, as investors shrugged off concerns about the smartphone market and seized on the outlook for memory chips.

“Shares are rising as Samsung Electronics’ outlook for its memory chip business appears more positive than we’ve heard from other companies,” said Greg Roh, analyst at HMC Investment & Securities.

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