Samsung's 2nd quarter chip sales unlikely made up for smartphone weakness

The world's biggest supplier of certain memory chips on Tuesday will announce preliminary April-June revenue as well as operating profit.

At Samsung Electronics Co Ltd, demand for its chips from data centres bulking up to meet a surge in work-from-home traffic was not likely enough to offset muted sales of its smartphones in the second quarter, analysts said.

The world's biggest supplier of DRAM and NAND memory chips on Tuesday will announce preliminary April-June revenue as well as operating profit, which it previously expected to show a decline.

Profit likely fell 4.5% to 6.3 trillion won ($5.25 billion) from the same period year earlier, according to Refinitiv SmartEstimate, which is weighted towards the more consistently accurate analysts.

Work-from-home orders and growth in online learning is underpinning chip demand amid the COVID-19 pandemic, prompting U.S. DRAM supplier Micron Technology Inc to forecast strong quarterly revenue last month.

Chips bring in roughly half of Samsung's profit. The rest is mainly smartphones, of which the South Korean firm is the world's largest maker.

"With improved demand, a spike in DRAM prices helped Samsung continue with a solid performance in the second quarter," said analyst Park Sung-soon at Cape Investment & Securities.

Those price increases were likely driven by data centres stockpiling chips and so are unlikely to continue, analysts said. Though DRAM prices jumped 14% in the quarter, they were flat in June versus May, showed data from DRAMeXchange.

Microsoft's Silicon Valley staff to work from home amid coronavirus fears

Microsoft asked many of its employees in the Seattle region near its headquarters and the San Francisco Bay Area to work from home if possible until March 25.

Microsoft Corp on Wednesday joined the growing number of US companies asking employees to work from home in order to limit exposure to the spreading coronavirus outbreak, as it responded to cases near its Seattle headquarters and in California.

Microsoft asked many of its employees in the Seattle region near its headquarters and the San Francisco Bay Area to work from home if possible until March 25.

"Taking these measures will ensure your safety and also make the workplace safer for those that need to be onsite," Executive Vice President Kurt DelBene told employees in a blog post.

The post said that some employees for whom "it is essential to be in the office or other work environments" - such as data center and retail employees - should continue to go to their work locations and that the company would follow government guidelines for disinfecting its sites for essential personnel.

Microsoft also asked employees to suspend any business travel to the areas "unless essential for the continuity of Microsoft."

Microsoft also said employees should cancel non-essential travel to areas with active coronavirus cases - which includes much of Europe, Asia and the Americas - and that employees were not required to travel if they had concerns about doing so.

In the greater Seattle area, the total number of coronavirus cases climbed to 39 on Wednesday and 10 deaths, up from 27 cases and nine deaths a day earlier, the Washington State Health Department announced. The first death in California from the coronavirus was announced on Wednesday.

The Seattle area has the largest concentration of coronavirus cases detected to date in the United States. Several cases were connected to a long-term care facility for the elderly.

Microsoft also implemented new guidelines for employees who do come to its offices. It recommended "limiting prolonged close interactions with people" by keeping in-person meetings as short as possible and staying at least 6 feet, or 1.8 meters, away from others.