Samsung Expects A Strong Third-Quarter Thanks To Chip And Display Sales

Sales were also expected to have risen 7.5 percent from a year ago to 51 trillion.

Samsung did not provide earnings or sales figure estimates for each of its business divisions.

In spite of the fact that Samsung stock leaped 8.7 percent, which is the biggest daily percentage gain in almost seven years, it remains down 5.7 percent so far this year. The company is under pressure to return a few of a cash pile of $53 billion through dividends or share buybacks.

Despite it struggles with other competitors, Samsung Electronics Co.is optimistic that its third-quarter profit will rebound after nearly two years of sales decline.

Currently, the high-end smartphone market is dominated by Apple while the lower end is dominated by Xiaomi. As predicted, the profits and mobile margins are expected to decrease in a periodic manner.

Samsung sets prices for most components in US dollars, gaining when the sales are translated back into Korean won, which has dropped against the greenback. Investors are anxious to see what Samsung has in plan to ensure more revenue for their next quarterly report.

The electronic giant’s shares opened up in South Korean trade by more than 4% on the news.

This year alone, Samsung took over mobile payment solution startup LoopPay Inc.; Simpress, a Brazil-based print solution company; and commercial display manufacturer Yesco Electronics.

The consumer electronics and display segments are estimated to have earned 300 billion won and 700 billion won, respectively, in the third quarter, analysts earlier said. It also reduced price for Galaxy S6 as its sales fell short of expectations. Samsung expects chip sales to generate its highest earnings for the fifth straight quarter.

The new Samsung phones are sold with a rebate of up to $120 through select carriers in the USA, with an extra benefit for customers switching from iPhones-an aggressive attempt at maintaining its share in the US market while seeking to expand the adoption of its recently launched mobile payment service, Samsung Pay.

“The below-$200 devices largely contributed to the overall smartphone shipment increase in the third quarter”, said Lee Seung Woo, an analyst at IBK Securities Co in Seoul.

“It is holding its own in the smartphone and tablet markets with a few strong new models like the S6 Edge and the Note 5”. The currency strengthened 1.2 percent in the past two and reached 1,161.82 on Tuesday, its strongest level since September 18, paring this year’s loss to 6.5 percent.