First-quarter profit jump

TECH giant Samsung Electronics Co Ltd on Thursday said it expected earnings to further improve in the current quarter, after it reported its best quarterly profit since 2013 thanks to a memory chip boom.

The South Korean company also said it had decided not to adopt a holding company structure, rejecting demands from US activist hedge fund Elliott Management.

It also announced a share buyback worth 2.3 trillion won ($F4.3b).

The first-quarter result supports expectations that the world’s top maker of memory chips, smartphones and televisions will book record profits in the coming quarter as well as for 2017.

Pre-orders for its Galaxy S8 smartphone launched in April were better than many analysts had expected, raising hopes that it would make up for the failure and costly withdrawal of the fire-prone Note 7s last year.

But complaints about red-tinted screens on the S8 and spotty Wi-fi connection have forced the company to offer two software fixes, denting some of the initial enthusiasm.

January-March operating profit for Asia’s most valuable company by market capitalisation was 9.9t won ($F18b), compared with Samsung’s earlier guidance of 9.9tw won ($F18b).

It was the highest quarterly profit since the third quarter of 2013.

Revenue rose 2 per cent to 50.5t won ($F93b).

Samsung’s chip business remained the firm’s top earner with a record 6.3t won ($F11b) operating profit.

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