Samsung loses over $270M from Texas plant shutdown as quarterly profits boom

Closing a semiconductor plant in Austin, Texas, caused Samsung to lose more than 300 billion won (about $270 million). yunhap news report. Seung-Hoon Han, Senior Vice President of Samsung Foundry Business Division, said in a conference call that the shutdown affected 71,000 wafers, “damage of about 3 to 400 billion won”. This statement, in line with Samsung’s recent earnings announcement, reported a strong performance in smartphones and other consumer electronics products.

The South Korean electronics giant had to shut down its Austin plant that produces microprocessors such as radio-frequency integrated circuits and solid-state drive controllers in February after a February storm left about 200,000 Austin homes out of power. . The shutdown lasted for a total of one month, and it was the longest time Samsung had to stop production at the plant. However, the company says the plant has returned production to 90% at the end of March and now returns to normal levels.

But overall Financial Times It reported that Samsung Electronics’ profits exceeded expectations. Net profit for the first quarter was 7.1 trillion won (about $6.4 billion), an increase of 46% year-on-year, recording the highest first-quarter profit since 2018. According to the mobile sector CNBC. Samsung says sales of its “acclaimed” flagship, the Galaxy S21 series, have increased along with more cost-competitive mid-range models.

Samsung’s own manufacturing problems coincided with a global shortage of chips affecting everything from graphics cards to cars and even toasters. Samsung said that the supply problem had a major impact on the business, contributing to the decline in mobile display sales in the first quarter. The company says that although supply issues are likely to persist through the second half of the year (reflecting similar predictions from TSMC and Intel), they are “increasing the use of outsourcing foundries to reinforce and compensate for their partnerships with in-house foundries.”

Otherwise, Samsung believes its business will benefit from global economic recovery and stimulus measures. In the second half, strong demand is expected for everything from servers to storage to smartphones to PCs. However, it specifically says that as people start their adventures outside, the demand for TVs may diminish in the same period.

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