A South Korean flag, left, and a Samsung Electronics flag flutter outside the company’s headquarters in Seoul, South Korea, on July 5, 2019.

Jean Chung | Bloomberg | Getty Images

Samsung Electronics shares failed to sustain previous gains on Friday after the company announced that its operating income for the quarter ended September 15.8 trillion Korean won ($ 13.26 billion) was likely 28% higher was than a year ago.

This will be the South Korean semiconductor giant’s best quarterly profit in three years – since Samsung posted a profit of more than 17.5 trillion won in the third quarter of 2018.

Still, according to Refinitiv SmartEstimate, Friday’s figure fell below analysts’ estimates of 16.1 trillion won.

Samsung shares rose more than 1% in early trading but gave up those gains and closed 0.14% lower.

Consolidated revenue for the quarter likely rose to a record high of 73 trillion won – up 9% year over year.

The South Korean tech giant has not broken down the performance of its individual business units, including its main profitable semiconductor business.

However, the operations of the world’s largest smartphone and chip maker are affected by a global chip shortage and the coronavirus pandemic that has closed some of its factories around the world.

“Both sales and operating profit [are] lower than our estimate and the market estimate, “said SK Kim, executive director and senior analyst at Daiwa Capital Markets.

Samsung is partially affected by the shortage of semiconductors, especially in the smartphone business, and is likely to have some logistics problems for its consumer electronics division, Kim said on Friday in CNBC’s “Squawk Box Asia”. However, rising semiconductor prices would likely have had a positive impact on Samsung’s components business, he added.

Daiwa has a target price of 110,000 won (about $ 92) per share for Samsung, up more than 53% from Thursday’s close as higher semiconductor prices are expected to boost the tech company’s earnings.

The chip shortage is beginning to affect the smartphone industry, where Samsung and Apple have previously been protected from the consequences by stocking up critical components such as memory chips.

Late last month, Counterpoint Research lowered its smartphone shipments projections for the second half of 2021, saying that some smartphone manufacturers are struggling to get all of the components they have ordered to make smartphones.

Full results for the September quarter are expected later this month.

Samsung stock has fallen more than 11% since the start of the year.