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Samsung announces first profit bump in two years

Weak won, improved inventory management, cost-cutting all play part in gains, say analysts

Samsung shares chased their biggest daily percentage gain in nearly four years in midday trade.
Samsung shares chased their biggest daily percentage gain in nearly four years in midday trade.

Samsung Electronics today announced its first quarterly profit bump in two years, Reuters reported.

The South Korean giant may have seen strong sales of its own chips and displays, which it sells to third party manufacturers and uses in its own phones to cut costs.

Reuters speculated that revenue from components may have helped to offset meagre performance from smartphones, in the face of stiffer competition from regional rivals selling devices at lower price points, and rampant demand for Apple's iPhones in the premium segment.

Samsung beat analysts' estimates, as it projected third-quarter operating profit would soar 79.8%, year on year, to KRW7.3trn ($6.3bn), compared with a KRW6.7trn profit predicted by a Thomson Reuters poll.

Analysts suggested a weak won was behind the success, but that did not stop Samsung shares chasing their biggest daily percentage gain in nearly four years in midday trade. Other analysts said cost-cutting and better smartphone inventory management were also factors in the gains.

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