Samsung announced strong growth in its first-quarter, after it was boosted by the sales of memory chips and the revival of its mobile business. In line with the previously announced guidance, Samsung Electronics' Q1 operating profit came in at 9.9 trillion won ($8.75 billion) while revenues grew by 2 percent to 50.5 trillion won. Ahead of the quarter result announcement, Samsung had forecasted 50 percent operating profit growth.
For Samsung, the chip business continues to be the top earner with a record operating profit of 6.31 trillion won in the first quarter. The strong demand for both DRAM and NAND memory chips boosted Samsung's margins this quarter. The components business, which includes displays and memory, is set to grow for the next quarter, but the overall supply is likely to remain tight.
Samsung's mobile division saw a decline in operating profit due to lack of a premium flagship smartphone. The profits came in at 2.07 trillion won, down from 3.89 trillion won reported during the same period last year. However, Samsung is upbeat about the next quarter, which will include the sales of its latest flagships, Galaxy S8 and S8+.
"Looking ahead to the second quarter, the company expects to achieve growth on the back of continued robust memory performance together with improved earnings from the mobile business," Samsung said in a statement.
Samsung also confirmed that it won't be splitting itself into two entities, but announced plans to cancel treasury shares worth over $35 billion by 2018. There has been a growing demand among investors to split the organisation into two separate entities after the arrest of its chief, Jay Lee.
For the year ahead, Samsung hopes to continue the growth momentum and deliver strong result backed by stronger demand for semiconductor chipsets and mobile devices. The company also confirmed its plan to announce its second flagship later this year, but didn't confirm whether it will continue with the Note branding.