Analyzing Samsung's Q2 Expectations

Samsung Electronics Co, Ltd SSNLF announced its earnings guidance for the second quarter of 2022.
Samsung expects consolidated sales of 77 trillion Korean won, up 20.9% year on year (versus actual sales of 63.67 trillion Korean won in Q2 2021).
It expects a consolidated operating profit of 14 trillion Korean won, up 11.4% Y/Y (versus an actual operating profit of 12.57 trillion Korean won in Q2 2021).
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Chipmakers like Samsung and Taiwan Semiconductor Manufacturing Company Ltd TSM see a demand correction from the pandemic and government stimulus-induced demand surge for electronic gadgets.
The Ukraine crisis and inflation also have restricted consumer spending on items.
The industry expects a challenging second half (as voiced by Advanced Micro Devices, Inc AMD and Micron Technology, Inc MU) as inflation restricts consumer spending for gadgets and the cryptocurrency market declines.
According to Counterpoint Research, Samsung will likely have shipped 62 million - 64 million units in Q2, down from the previous estimates of 68 million smartphones.
Piper Sandler saw DRAM, and NAND pricing decline, affecting Micron as mobile and notebook end-markets face continued weakness based on inSpectrum's June monthly memory contract pricing data.
Analysts saw server chip demand as the only bright spot, Reuters reports.
Amazon.com Inc AMZN, Microsoft Corp MSFT, Alphabet Inc's GOOG GOOGL Google and Meta Platforms Inc's META continued chip purchase to meet cloud demand so far helped to shield Samsung's profits.
Price Action: TSM shares traded higher by 3.23% at $78.00 in the premarket on the last check Thursday. MU shares traded higher by 1.34% at $58.14, and AMD shares traded higher by 1.34% at $76.36.

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