Samsung Electronics sees Q2 profit fall as virus hits sales of smartphones, TVs

Samsung Electronics Co Ltd said on Wednesday it expected its profit to decline in the current quarter, as strength in the chip business would be offset by a sales slump in smartphones and TVs. Samsung said its first-quarter operating profit rose 3% in the January-March period, in line with an earlier estimate, as the stay-at-home trend due to the COVID-19 pandemic cushioned the virus blow.

The South Korean tech conglomerate`s chip business is benefiting from demand for servers and computers as stay-at-home orders force millions of people around the world to convert their homes into offices. But sales of TVs and smartphones have slowed as recession-wary consumers postpone purchases of non-essential consumer electronics, a trend seen across the global tech industry.

See Zee Business Live TV streaming below:

"Sales and profits of set products business, including smartphones and TVs, are expected to decline significantly as COVID-19 affects demand and leads to store and plant closures globally," Samsung said in a statement.

The world`s top maker of memory chips and smartphones reported an operating profit of 6.4 trillion Korean won ($5.2 billion), compared with 6.2 trillion won a year ago and its earlier estimate of 6.4 trillion won.

It said net profit fell 3% to 4.9 trillion won, while revenue climbed 5.6% to 55.3 trillion won.

Samsung Electronics shares fell 0.8% in a flat wider market in morning trade on Wednesday. The shares are down 10% so far this year, in line with the wider market.