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Samsung profits fall 95%

2023-04-27 11:09:00, Tech CNA

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Samsung Electronics announced a gradual chip recovery in the second half of the year after its semiconductor business reported a record loss on Thursday, driven by weak demand for technology equipment.

A global decline in semiconductor purchases amid an economic slowdown and weak customer spending caused chip prices to fall in the first quarter, prompting production cuts across the sector.

Samsung ( SSNLF ) said its chip business will focus on servers and high-capacity mobile products "based on expectations of a gradual market recovery and a rebound in global demand" in the second half.

For the current quarter, Samsung said it expected limited recovery for memory chips as major data center firms invested more conservatively in servers.

The world's largest memory chipmaker said operating profit fell to 640 billion won ($478.6 million) for the January-March quarter, down 95% from 14.12 trillion won a year earlier and the lowest profit for any quarter. in 14 years. Revenue fell 18% to 63.7 trillion won.

The South Korean tech giant's chip division reported a loss of $4.58 trillion compared with a profit of $8.45 trillion a year earlier.

Shoppers around the world have cut back on purchases due to rising inflation. As a result, smartphone, PC and server companies have run out of inventory, causing chip prices to fall by about 70% over the previous nine months.

Samsung made a rare announcement of a cut in chip production earlier this month, joining smaller rivals.

While that could help chip prices recover a bit, analysts said Samsung's current quarter profit could be similar to the first quarter without a substantial recovery in demand for devices that use chips.

Deri në gjysmën e dytë të vitit, klientët do të kenë mbaruar inventarin dhe gradualisht do të fillojnë të blejnë përsëri çipa, tha Samsung.

Pavarësisht humbjes rekord në çipa, Samsung tha se shpenzoi 10.7 trilionë në shpenzime kapitale gjatë tremujorit të parë, më e larta për tremujorin e parë të çdo viti.

Nga kjo, 9.8 trilionë unë u shpenzuan për çipa, ndërsa Samsung ngriti prodhimin në fabrikat e tij në Taylor, Teksas dhe Pyeongtaek, në Korenë e Jugut.

"Samsung Electronics do të vazhdojë të investojë në gjysmëpërçuesit e memories në një nivel të ngjashëm me vitin e kaluar për të siguruar konkurrencë afatmesme dhe afatgjatë," tha ai.

Biznesi celular i Samsung ishte një pikë më e mirë, duke raportuar 3.94 trilionë fitime në tremujorin e parë, nga 3.82 trilionë fitime një vit më parë.

"Samsung is focusing on profit rather than shipments" as it meets more elastic demand for premium smartphones than volume, said Jene Park, senior analyst at Counterpoint.

In the second half, Samsung predicted that the smartphone market will grow in both shipments and revenue as the global economy recovers.

Samsung shares fell 0.5% in morning trade, in line with the broader market.

Samsung shares are up about 16% year-to-date as investors anticipate a memory chip recovery in the second half of this year./ CNA.al