Mirae Asset Securities logo

The start of an exceptional earnings cycle

1Q26 preliminary results: Quick review

Samsung Electronics (SEC) announced preliminary 1Q26 revenue of W133.1tr (+41.8% QoQ) and operating profit of W57.2tr (+185.2% QoQ), significantly exceeding both the consensus and our estimates. By division, we estimate operating profit at W53tr for DS (W54tr for memory, -W1tr for foundry), W3.4tr for DX, W0.5tr for Samsung Display, and W0.3tr for Harman. The results also appear to reflect provisions related to performance-based compensation.

We believe the strong performance was driven primarily by memory. For DRAM, we estimate operating profit at W42.5tr (OP margin: 78.1%), with bit growth of +2% and ASP growth of +90%. For NAND, we estimate operating profit at W11.6tr (OP margin: 63.5%), with bit growth of +9% and ASP growth of +81%. The ASP increases appear to have been significantly steeper than our previous estimates (+64% for DRAM, +53% for NAND).

We expect the price uptrend to continue in 2Q26, with both DRAM and NAND ASPs rising around 20% QoQ. We also project bit growth of around +7% for both DRAM and NAND. Accordingly, we forecast company-wide revenue in 2Q26 at W151.7tr (+14.0% QoQ) and operating profit at W76.8tr (+34.2% QoQ). We plan to adjust our estimates in greater detail following the upcoming earnings call.