Samsung has predicted a profit jump of nearly 60% last quarter, suggesting it will retake its position as the world’s top smartphone seller as the fallout from the coronavirus pandemic eases and US sanctions against rival Huawei bite.
Samsung said it expects sales for the third quarter will rise about 6% to 66 trillion won ($57 billion).
Earlier, Samsung was displaced by Huawei as the world’s top smartphone seller as the coronavirus pandemic weighed on the global economy.
But the slump may now be easing for Samsung, just as fresh sanctions on Huawei leave the Chinese company struggling to survive.
For Samsung, a sharp rise in smartphone sales will drive a rebound in earnings for the third quarter and the boost will likely carry over to next year, SK Kim, an analyst at brokerage firm Daiwa, said in a research note last week.
The sales bump is driven by US restrictions on Huawei, a rise in demand for 5G phones and “improved cost structure with a rapid shift to online marketing,” said Kim. The pandemic has led to the shutdown of retail stores around the world and lower marketing costs.
The company also supplies key parts like display panels and memory chips for other smartphone makers such as Apple, as well as Huawei rivals Xiaomi and Oppo, according to local reports.
“Samsung is poised to see shipments of semiconductors and display panels to captive customers grow, fueled by increased sales,” Lee Su-bin, an analyst with Daishin Securities, wrote in a note last month.
