Samsung predicts record profits for third quarter as memory business booms

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In its earnings preview on Friday, Samsung put its July-September operating profit at 14.5 trillion won ($12.8 billion), compared with 5.2 trillion won ($4.6 billion) a year earlier.

Analysts estimated 14.3 trillion won in operating profit according to financial data provider FactSet.

The company also estimates third-quarter sales of 62 trillion won compared to 47.82 trillion won previous year.

Samsung's guidance did not elaborate on the performance of specific business units, but analysts say the firm's strong performance was likely helped by rapid sales of its new Galaxy Note 8 smartphone, which is the successor to the disastrous Note 7 that was recalled after reports of exploding batteries. So strong is this demand that Samsung, the world's leading flash memory maker, has been able to secure both high prices and high volumes for its flash products, with some analysts estimating a profit margin of nearly 50 percent.

KB Securities added that rising sales of the Galaxy S8 and Galaxy Note 8 smartphones will also improve the profitability of the mobile division, putting the sector's operating profit estimate at a better-than-expected 3.3 trillion won.

As for the fourth quarter, Samsung Electronics is expected to continue its growth, backed especially by its highly competitive chip business.

Kwon Oh-Hyun, co-vice chairman and chief executive officer of Samsung, will retire from company management in 2018.

Mirae Asset Daewoo Securities added the consumer electronics division will experience growth on the back of strong seasonal demand.

Industry watchers, meanwhile, said the absence of Samsung's top leaders cast a cloud over the company's long-term strategy.

Lee, who was found guilty in August of bribery, perjury and other charges relating to payments made by Samsung to ousted president Park Geun-Hye's secret confidante Choi Soon-Sil, is appealing his five-year sentence and says he is innocent.

His ailing father Lee Kun-hee has been hospitalized since 2014, and is now unable to participate in the company's management.

Samsung shares were trading at a new record high of 2.74 million won as of Thursday, as investors bet on record earnings in 2017 driven by growing demand for memory chips with ever greater processing power.

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