Samsung expects 58% profit bump in the third quarter

Company likely got a boost from increased demand for chips during the pandemic.

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Samsung got a big boost in operating profit during the third quarter.

James Martin/CNET

The slowdown in tech doesn't appear to be weighing on Samsung as much as it has in the past.

The company on Wednesday predicted its operating profit for the third quarter would come in around 12.3 trillion won ($10.6 billion), an increase of 58% compared with the year-ago period. It also said its revenue increased by nearly 5% to 66 trillion won ($57 billion).

The quarter represents a rebound of sorts for the Korean electronics giant, which in the year-ago period reported a 56% decline in operating profit.

Samsung didn't say what impacted its results, but it likely received a boost in demand for its chips as more people are forced to work from home during the coronavirus pandemic. The company will report its final results later this month. 

Samsung sells more phones and TVs than any other vendor, but it also has a huge business selling memory chips to device makers around the globe. In recent months, Samsung's chip business has gotten a boost from data centers that rely on the technology to store everything we're doing online. Revenue from the company's semiconductor business increased 13% in the second quarter to 18.2 trillion won.

At the same time, those businesses Samsung's better known for have been struggling.  2020 was supposed to be a strong year for the phone industry, as innovations like 5G and foldable screens got people shopping again. Instead, financial struggles and worries about COVID-19 will limit the number of devices companies can make and how many phones people will actually buy.

In April, Samsung warned that the coronavirus would "significantly" hurt its operations in the coming months but said in July it expects smartphone sales to rise in the third quarter compared with the second quarter.

CNET's Shara Tibken contributed to this report.