South Korean Samsung Electronics saw its operating profits surge in the first quarter of this year compared to the previous year. The company attributes the increase to its semiconductor division which manufactures bitcoin mining chips and says that it expects the trend to continue into the second quarter.
Also read: Yahoo! Japan Confirms Entrance Into the Crypto Space
Profits Surging
A world leader in advanced semiconductor technology, South Korean Samsung Electronics Co. Ltd. recently announced its 1Q18 earnings results. Samsung Electronics is the flagship company of the Samsung Group with assembly plants and sales network in 80 countries.
In the first quarter of this year, the company recorded consolidated earnings of 60.56 trillion won (~US$56 billion). Its operating profits were 15.64 trillion won (~$14.5 billion), a 58% increase from 9.9 trillion won (~$9.2 billion) achieved during the same period last year. Meanwhile, its year-on-year sales grew approximately 20%.
The Seoul Newspaper elaborated that Samsung Electronics’ “semiconductor division…accounted for about three-quarters (73%) of total operating profits, leading the company to a record high.” Samsung explained:
Demand for the semiconductor division increased due to sales of system LSIs [ASICs] for flagship smartphones and demand for virtual currency mining chips.
Samsung’s Mining Chips & Earnings Outlook
Samsung confirmed in January that it had begun manufacturing ASIC chips used for mining cryptocurrencies such as bitcoin and ether. Without providing details, a company spokesperson told Techcrunch at the time that “Samsung’s foundry business is currently engaged in the manufacturing of cryptocurrency mining chips.”
Samsung Electronics offers design services which connect “mid-to small-sized companies with qualified ASIC design services and support.” In January, the Samsung Advanced Foundry Ecosystem program was launched to ensure deep collaboration between the Samsung foundry, ecosystem partners, and customers.
Mining rig manufacturer Halong Mining has previously revealed that its flagship product, the Dragonmint T1 Miner, uses Samsung’s 10nm T1558 mining chips, calling them “the first-ever 10nm bitcoin mining chips.” Halong says their rig is “the world’s most efficient bitcoin miner, operating at 16TH with Asicboost technology inside for greater power efficiency.”
“Earnings growth should continue in 2Q18, driven by demand for HPC-based semiconductors and an increase in supply of new 10nm process products,” Samsung Electronics detailed, emphasizing that “In the foundry business, despite a decline in demand for mobile parts due to seasonal weakness in 1Q18, earnings increased on the back of high-performance computing (HPC) chip orders.” The company continued to share:
The foundry business is expected to secure the second place in the industry with more than $10 billion in sales.
Mining Chip Market
In the field of ASIC mining chip manufacturing, Samsung Electronics is competing with a few other chipset manufacturers. The largest is Taiwan’s TSMC, which supplies mining chips to mining hardware makers such as Bitmain and Canaan. Recently, news.Bitcoin.com reported on TSMC hitting record sales during March due to demand for the hardware required for crypto mining.
According to a Trendforce study published in November of last year, TSMC held a 55.9% market share by revenue in the semiconductor foundry business, followed by Global Foundries with 9.4% market share, UMC with 8.5% and then Samsung with 7.7% market share.
Do you think Samsung will soon gain market share in the mining chip market? Let us know in the comments section below.
Images courtesy of Shutterstock, Samsung, and TSMC.
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The post Samsung Profits Surge on High Demand for Bitcoin Mining Chips appeared first on Bitcoin News.
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