Samsung has warned of further declines to overall earnings for the second half after announcing first quarter earnings slumped 7.6 per cent from the previous quarter.
In its first quarter earnings report, Samsung warned “sales and profits of set products business, including smartphones and TVs, are expected to decline significantly as COVID-19 affects demand and leads to store and plant closures globally.”
The South-Korean manufacturer reported total revenue had dropped to £36.6 billion for Q1 2020, while operating profit was also slightly down to £4.2 billion.
But strong demand for server and mobile components led to year-on-year revenue growth of 5.6 per cent for the quarter.
Samsung’s mobile division performed strongly despite weaker sales towards the end of the quarter as the coronavirus pandemic took hold. Stronger sales of 5G smartphones were able to lift Samsung in the quarter according to the vendor in its financial report.
For the quarter Samsung posted £17.1 billion in consolidated revenue and £1.75 billion in operating profit, representing growth of 16.7 per cent.
However Samsung is warning of a sharp drop in demand for smartphones during Q2 across most regions as a result of the economic downturn caused by the coronavirus.
The vendor confirmed that it is still looking to push ahead with the annual Note series later this year, but does mention that investment in 5G technology may be limited.
