Samsung Reports 57.4% Increase in Chip Production in Q1 2020 Despite COVID-19 Crisis

Samsung Electronics' chip production in the first quarter of the year increased 57.4 per cent from a year earlier despite the spread of the novel coronavirus, the company's quarterly business report showed on Monday. Samsung, the world's largest memory chip maker, produced 277.4 billion units of semiconductors in the January-March period, up from 176.2 billion units a year earlier, according to the report. Its chip factory operation rate was 100 per cent.

Industry insiders said Samsung's increased production was aimed at meeting the rising demand for server chips as the coronavirus pandemic boosted non-face-to-face activities. In contrast, Samsung's mobile phone and display production plunged in the first quarter, the report showed, due to factory shutdowns from the virus outbreak.

Samsung produced 58.7 million handsets and 1.45 million units of display products in the first three months of 2020, down 34.4 percent and 35.5 percent from a year earlier, respectively. The operation rate for Samsung's mobile manufacturing business was only 73.3 percent in the first quarter, according to the report, down 16.2 percentage points from a year earlier, reports Yonhup news agency.

Industry observers expected that Samsung's operation rate for its mobile and TV plants in the second quarter is likely to be worse than the first quarter, as more manufacturing bases have suffered shutdowns. In the current quarter, Samsung had to temporarily close its plants in countries including India, Brazil and Mexico due to the pandemic.