The largest smartphone maker company of the world, Samsung, forecasts its profit soared over twenty percent last quarter, suggesting that the firm managed to withstand the fallout from the COVID-19 pandemic. On Tuesday, Samsung said that it expects to make an operating profit of approximately $6.8 billion (8.1 trillion won) for the three months that ended in June. That is over around twenty-three percent from the same period last year.

.@CNNBusiness: The South Korean conglomerate said that it expects to make an operating profit of roughly 8.1 trillion won ($6.8 billion) for the three months that ended in June. That’s up nearly 23% from the same period a year ago. @Sherisse has more. https://t.co/Cr00TPHosF

— CNN Asia Pacific (@cnnasiapr) July 7, 2020

The estimations also beat nearly two percent profit fall that analysts polled by Refinitiv in a prediction. Samsung said that it predicts sales will drop around seven percent to $43.6 billion (fifty-two trillion won). Forecasters polled by Refinitiv foreseen $43 billion (51.4 trillion) in sales. Samsung shares opened up 1.5% in Seoul but later overturned those gains. The stock finished the day with 2.9% down. Kospi Index of South Korea closed down one percent.

The South Korean multinational firm said that the estimations include a one-time gain linked to the display business. Otherwise, it didn’t elaborate on earnings but will report complete results for the 2nd quarter at the month-end.

Samsung is the big supplier of display panels and chips

Samsung – which provides key parts such as chips and display panels for companies like Huawei and Apple – stands among the first big technology firms to report earnings for the quarter. Whereas, its full report will take as a bell-weather for how technology giants are withstanding the coronavirus pandemic.

The tech giant has been enjoying a lift to its business of memory chips because of the pandemic. According to the analysts, millions of people worldwide continue to work, watch movies, and play games from home, leading to increasing demand for strong chips from data centers.

However, sales in the consumer electronics unit received a big hit. Last month, SK Kim, the Daiwa analyst, wrote in a note that the sales of smartphones in the 2nd quarter possibly plunged to fifty-five million units. According to the statistics from market research firm IDC, that would help a plunge of over twenty-seven percent from the same period in 2019. Still, analysts say that the consumer electronics unit of Samsung, which includes Television and smartphone sales, is still profitable because of ongoing travel and work restrictions.

Kim and Lee Subin said that in spite of disappointing sales, the smartphone unit of Samsung likely enjoyed inclusive profit margins as the closure of retail stores means lower marketing costs. Furthermore, Kim said that reduced internal costs such as business travel because of coronavirus also gave shoulder to the bottom line of the smartphone division.

Read Also: Tesla posted a 2020 1st quarter profit regardless of COVID-19