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Samsung Electronics(expects demand for artificial intelligence to remain strong in the second half, further boosting sales of memory chips and tech devices. The development has already caused a 10-fold increase in operating profit in the first quarter.

Sales of memory chips from the South Korean company nearly doubled in the first quarter from a year earlier, when prices rose sharply after a severe downturn.

Operating profit rose to 6.6 trillion won ($4.8 billion) in January-March, up from 640 billion won a year earlier.

Sales in the first quarter rose 13 percent to 71.9 trillion won, of which memory chips accounted for 17.49 trillion won.

The chip division has historically been Samsung's biggest revenue maker, accounting for a profit of 1.91 trillion won.

Prices of NAND flash chips used to store data rose 23 to 28 percent in the first quarter compared with the previous quarter, while prices of DRAM chips used in tech devices rose about 20 percent, according to TrendForce data.

Samsung's mobile device business posted an operating profit of 3.51 trillion won in the first quarter, down from 3.94 trillion won a year earlier. Rising costs, including higher prices for memory chips, squeezed the margins of Galaxy S24 smartphones launched in the quarter.

Samsung is expected to announce the Galaxy Z Flip6 and Galaxy Z Fold6 on July 10 this year. During this second Galaxy Unpacked event this year, the company may also showcase the first Galaxy Ring, which monitors health. The ring was already demoed at Mobile World Congress earlier this year.

The overall smartphone market rose 7.8 percent in the first quarter, with a total of 289.4 million shipped to winkles. At 20.8 percent, Samsung is back in first place, followed by Apple at 17.3 percent.

Rival LG Electronics Inc. (LG) announced consolidated revenue of $15.31 billion (KRW 21.09 trillion) and operating profit of $965.3 million (KRW 1.33 trillion) for the first quarter of 2024. The home appliances sector achieved record sales and double-digit operating profit margins. The EV components sector continued its steady growth.

LG Home Entertainment Company reported first-quarter sales of USD 2.5 billion (KRW 3.49 trillion) and an operating profit of USD 96 million (KRW 132.2 billion) thanks to a rebound in demand for TVs in Europe and the launch of the new 2024 models.

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