Samsung reports steep rise in profit for the first quarter of 2022

Samsung has reported a massive rise in operating profit for the first three months of 2022, thanks in part to the robust demand for its memory chips and the strong sales of its new Galaxy flagship devices. The Korean tech giant has posted an operating profit of KRW 14.12 trillion ($11.12 billion), which is 51 percent higher than the same period last year, and a record consolidated revenue of KRW 77.78 trillion ($61.2 billion). 

As usual, Samsung’s memory division was a standout performer, exceeding market forecasts because memory prices didn’t drop as much as analysts had expected. It posted a consolidated revenue of KRW 26.87 trillion ($21.14 billion), and while it saw a slight decline in profit due to incentives and seasonality, demand for PC and server chips remained solid. The company’s foundry business also contributed to the division’s performance by achieving its highest ever first quarter sales. Samsung is optimistic for the division’s prospects going forward, but it also expects component shortages to persist through the second half of the year and will constantly monitor the situation. 

While overall demand for mobile was down due to seasonality and “geopolitical uncertainties,” Samsung posted higher profit (KRW 3.82 trillion or $3 billion) and revenue (KRW 32.37 trillion or $25.5 billion) for the division this quarter compared to the last. The strong sales of its new flagship phones, particularly the Galaxy S22 Ultra, as well as of its mass market 5G phones contributed to both profit and revenue growth. Despite the allegations that a preinstalled app on S22 phones is throttling the performance of several applications, the company previously said that demand for the flagship is 20 percent higher than of its predecessor’s. Samsung expects component shortages for mobile to continue, as well, but it also expects the availability of component supplies for the S22 to improve. That’s why it plans to focus on maintaining strong sales for its flagships in the next quarter.

The tech giant reports a rise in mobile display earnings due to solid demand for premium products, as well. For larger displays, it says its QD monitors were well-received. It debuted its QD-OLED technology, which differs from standard OLED in that it only uses blue organic light-emitting diodes for a brighter output, at CES earlier this year. Samsung’s TV business lagged behind its other divisions, though, and saw a decline in demand following strong sales in the end of 2021 and the Russian invasion of Ukraine. In early March, Samsung halted its product shipments to Russia, where it has a TV plant and where it’s known as the top smartphone brand. 

Robinhood lays off nine percent of its full-time employees

Robinhood is letting around nine percent of its full-time employees go, company CEO Vlad Tenev has announced. In a blog post, Tenev said the company grew rapidly throughout 2020 and in the first half of 2021, thanks to several factors that include COVID-19 lockdowns. Robinhood’s revenue grew from $278 million in 2019 to over $1.8 billion in 2021, and it hired so many new employees to “meet customer and market demands” that its headcount grew from 700 to nearly 3,800.

Tenev explained that the rapid growth in headcount led to “some duplicate roles and job functions” and the the company decided that reducing its workforce is the right move to improve efficiency. “We will retain and continue to hire exceptional talent in key roles and provide additional learning and career growth opportunities for our employees,” he said. 

The CEO’s announcement comes just as the company’s stock hit its lowest closing price ($10) since it went public. As TechCrunch reports, it also comes just before Robinhood announces its first quarter results on April 28th and could be a measure meant to preempt investor disfavor in case its results fall short. 

Robinhood is known for pioneering commission-free stock trades and, as Tenev said, skyrocketed in popularity in the early days of the COVID-19 pandemic. However, its practices had previously drawn criticism, as well. In late 2020, the Securities and Exchange Commission fined the company $65 million for “misleading customers about revenue sources and failing to satisfy duty of best execution.” It was also hit with a class action lawsuit after it restricted trading on GameStop and other “meme stocks.” And in late 2021, the company was targeted by a cyberattack that exposed the data of as many as 7 million users.

Twitter is reportedly re-examining Elon Musk’s $43 billion takeover bid

Twitter may be warming up to the idea of selling itself to Elon Musk. According to The Wall Street Journal, the company is re-examining Musk’s takeover bid after the billionaire announced he had the financial backing to get the deal done. When Musk fir…

Tesla can now insure your EV in Colorado, Oregon and Virginia

Tesla’s in-house insurance is now available in three more states. As Forbesnotes, Tesla revealed during its latest earnings call that its “real-time” insurance has reached Colorado, Oregon and Virginia. The automaker has also filed paperwork in Nevada with plans to offer insurance as early as June, although nothing has been announced so far.

As in some other states, the insurance determines your premiums based on driving behavior rather than standard criteria like age and credit. Tesla examines the safety scores from its EVs and looks for signs of aggressive habits that might lead to incidents, such as collision warnings, hard braking and tailgating. This rewards better driving — and, of course, keeps you buying Tesla vehicles.

The company eventually plans to offer insurance across the entire US. Whether or not that goes smoothly is unclear. Tesla offers insurance in California, but it’s still seeking permission to use real-time info. It could be a while before the insurance and its signature feature are consistently available.

HBO and HBO Max gained 3 million subscribers before splitting from AT&T

HBO Max and HBO picked up 3 million subscribers in the same quarter that Netflix lost 200,000 of them for the first time in years, Variety reported. The streaming/cable service reported earnings under former parent AT&T for the last time, as it’s set to become part of the new Warner Bros. Discovery media conglomerate.

The lion’s share of new HBO/HBO Max subs were in the US (1.8 mllion), and the services now count 48.6 million subscribers domestically and 76.8 million worldwide. That’s up 12.8 million over last year, showing solid growth. (HBO Max costs $15 per month ad-free or $10 with ads, and HBO on cable is $15 per month.)

However, it was still a drag on parent AT&T (for the last time). WarnerMedia revenue was down 32.7 percent over last year to $1.3 billion due to investments in HBO Max and the failed launch of CNN+.

That’s essentially why AT&T decided to divest WarnerMedia and focus strictly on its core telecom business. To wit, the company announced its largest gain in post-paid phone net additions in more than a decade. Excluding WarnerMedia and other divested businesses, AT&T revenue was $29.7 billion, up 2.5 percent over the same quarter last year.

With WarnerMedia and Discovery divested, AT&T plans to invest any free cash in 5G and fiber deployments (it still has $169 billion in debt, despite the $43 billion dollar deal to sell WarnerMedia.) “AT&T has entered a new era,” said CEO John Stankey in a prepared statement during the company’s earnings call.

Amazon reportedly paid no income tax on $55 billion in European sales in 2021

Although Amazon’s main European business saw an increase in sales to around $55 billion last year, the company avoided paying income tax. It posted a loss of €1.16 billion euros ($1.26 billion) and it even received €1 billion in tax credits. According to filings obtained by Bloomberg, the credit was “mainly due to the use of net losses carried forward in accordance with the tax consolidation system.”

The Amazon EU Sarl unit is based in Luxembourg and reports revenue from its divisions in the UK, Germany, France, Italy, Spain, Poland, Sweden and the Netherlands. Its sales increased by 17 percent in 2021.

“Across Europe, we pay corporate tax amounting to hundreds of millions of euros,” an Amazon spokesperson told Bloomberg. They said revenue, profit and tax are reported to local authorities in each country. The company said it posted a loss after opening more than 50 new sites across the continent last year.

Amazon has been the subject of criticism for years for tax breaks it receives and how it reports income. In 2017, the European Union slapped Amazon with a €250 million ($280 million) tax bill over alleged illegal state aid practices dating back to the early 2000s. Amazon successfully appealed the bill last year. The European Commission has filed an appeal against that decision in the European Court of Justice.