Joyce Lee and Heekyong Yan

SEOUL (Reuters) – Samsung Electronics Co Ltd (OTC) reported Thursday a 50% increase in quarterly operating earnings. The company posted its highest first quarter profit since 2018 thanks to strong demand.

First quarter profits for the largest smartphone and memory chip manufacturer in the world were estimated at 14.1 trillion won (11.6 billion), against a Refinitiv SmartEstimate 13.3 trillion won.

According to preliminary earnings releases, revenue rose by 18% over last year, reaching a new record of 77 trillion won.

Samsung (KS) will release details earnings on April 28,

Although chips prices fell in the first quarter of 2018, analysts stated that they held up well due to robust demand, cautious investment spending by chipmakers, and limited capacity expansion. The chip segment, which accounts for half of Samsung’s profits, has seen a boost.

TrendForce reports that the cost of one DRAM chip type used widely in data centres fell by 8%, and the price of NAND flash memory, which are used to store data in devices such as laptops, plummeted between 5%-10%.

DRAM prices are expected to remain low in April-June, as higher inflation may lead to lower demand for smartphones, computers, and laptops. Analysts believe that DRAM prices will continue to decline.

However, in February there was a contamination of raw materials at the NAND Flash Chip plant by American company Kioxia. Western Digital TrendForce predicted that NAND Flash prices would rise between 5% and 10% due to increased inventories by buyers.

($1 = 1,218.1800 won)