Major companies such as Samsung Electronics, LG Electronics, and SK Hynix in electronic industries are set to make best performance of their companies＇ histories during second quarter. While it is expected that they are going to make their best performance of their companies’ histories during second quarter, it is predicted that they going to record earning surprise that easily surpass their current estimated values. It is likely that these companies will continue their positive performance until second half of this year due to booming of semiconductor and display markets and improvement of systems.
According to industries on the 11th, it is expected that major electronic companies such as Samsung Electronics, LG Electronics, SK Hynix, and LG Display will make performance during second quarter that surpasses estimations.
Forecast of performance of these businesses was bright due to booming of markets this year and made best performance of their companies＇ histories during first quarter. It was also expected that they are going to have very positive report cards during second quarter and it seems that they are making growth that surpasses even estimations. Their stocks are also rising steadily due to growth of their performance.
It is certain that Samsung Electronics will make its best quarterly performance during second quarter. Samsung Electronics＇ biggest operating profit in one quarter was during third quarter of 2013 when it made $9.03 billion (10.16 trillion KRW). Consensus of Samsung Electronics’ operating profit for second quarter is currently $11.5 billion (12.99 trillion KRW) and it easily surpasses previous record.
A part that needs to be paid attention is the fact that estimations are continuing to rise. Current estimation has increased by 21.58% compared to the estimation from 3 months ago and some even believe that current estimation will continue to rise as they estimate that Samsung Electronics＇ operating profit of second quarter will surpass $12.4 billion (14 trillion KRW). This estimation is continuing to rise because booming of semiconductor markets and sales of Smartphones with Galaxy S8 at the front are higher than expectations.
It is likely that SK Hynix, which is enjoying booming of semiconductor markets, will break its previous best quarterly performance once again. SK Hynix made a new record in last first quarter by making $2.19 billion (2.4676 trillion KRW) of operating profit and it is estimated that it will make a new record again in second quarter by making $2.55 billion (2.8658 trillion KRW). Expectations are high as this estimation is 35% higher than the estimation from 3 months ago. As supply and demand of DRAM continues to be tight, it seems that its ultimate operating profit of second quarter will be higher than current estimations. Markets are estimating earning surprise that easily surpasses $2.61 billion (3 trillion KRW).
It seems that LG Electronics will continue its positive performance due to improvement of its system. H&A (Home Appliance & Air Solution) Business Headquarters, which is in charge of home appliance business, has one of the world＇s best competitive edge; HE (Home Entertainment) Business Headquarters is also expected to make positive performance by releasing new products. It is set to make about $693 million (780 billion KRW) of operating profit during second quarter which is somewhat lower than operating profit of first quarter. However compared to estimations from 3 months ago, current estimation has increased by about 50%.
As display industries are booming, forecast of LG Display＇s performance is also positive. As it increases its competitive edge in small and medium OLEDs as well as large OLEDs, its forecast is very bright. It is estimated that its operating profit of second quarter will be around $800 million (900 billion KRW) which is about 30% increase compared to the estimation from 3 months ago.
“As industries such as semiconductor and display industries are booming, growth of South Korean electronic industries’ performance is accelerating.” said a representative for an electronic industry. “South Korean companies are consistently making positive performance in Smartphone and home appliance businesses as they have high competitive edge in them.” This representative also added by saying that estimations of their performance are increasing every day along with their stocks.
Staff Reporter Kwon, Keonho | wingh1@etnews.com
