Despite a supply decrease, Samsung Electronics' June-quarter earnings is anticipated to fall 96% year on year to the lowest for any quarter in more than 14 years, as a chip oversupply continues to generate big losses in the tech giant's cash cow industry.
According to a Refinitiv SmartEstimate from 27 analysts, the world's largest maker of memory chips, cellphones, and TVs' operating profit is anticipated to fall to 555 billion won ($427 million) in the April-June quarter.
If this is the case, it will be Samsung's lowest profit since the fourth quarter of 2008, when the company reported a combined operating loss of almost 740 billion won. It compares to a 14.1 trillion won operating profit in the April-June quarter of previous year.
This is due to the fact that its semiconductor sector, which has historically been its greatest revenue generator, most likely incurred quarterly losses of between 3 trillion and 4 trillion won as memory chip prices continued to decline and its inventory values plummeted.
According to TrendForce, prices of DRAM memory chips, which are frequently found in smartphones, PCs, and servers, continued to decline in the third quarter as customers used up stocks rather than making new purchases.
The price decrease did, however, slow from prior quarters as Samsung Electronics and other memory chip competitors reduced supply, and analysts predict it to level out around the third quarter, but a significant rebound might not happen until 2024.
Samsung is aiming to raise its share of chip demand from the rapidly growing artificial intelligence (AI) market despite the present slump, they claimed, using high bandwidth memory (HBM) and semiconductor contract manufacturing as examples.
An average of five experts' predictions for its mobile division suggests that it made an operating profit of about 3.3 trillion won, with measures to decrease marketing expenses offsetting a modest decline in smartphone shipments from the first quarter, when Samsung unveiled its most recent flagship model.
Analysts believe Samsung's decision to reveal its most recent foldable handsets in Seoul later this month, weeks earlier than normal, is an attempt to maintain its dominance in the premium phone market before rival Apple publishes its next iPhone.
The IT giant will release its full second-quarter earnings later this month after releasing its early numbers on Friday.
(Source:www.cnbctv18.com)
According to a Refinitiv SmartEstimate from 27 analysts, the world's largest maker of memory chips, cellphones, and TVs' operating profit is anticipated to fall to 555 billion won ($427 million) in the April-June quarter.
If this is the case, it will be Samsung's lowest profit since the fourth quarter of 2008, when the company reported a combined operating loss of almost 740 billion won. It compares to a 14.1 trillion won operating profit in the April-June quarter of previous year.
This is due to the fact that its semiconductor sector, which has historically been its greatest revenue generator, most likely incurred quarterly losses of between 3 trillion and 4 trillion won as memory chip prices continued to decline and its inventory values plummeted.
According to TrendForce, prices of DRAM memory chips, which are frequently found in smartphones, PCs, and servers, continued to decline in the third quarter as customers used up stocks rather than making new purchases.
The price decrease did, however, slow from prior quarters as Samsung Electronics and other memory chip competitors reduced supply, and analysts predict it to level out around the third quarter, but a significant rebound might not happen until 2024.
Samsung is aiming to raise its share of chip demand from the rapidly growing artificial intelligence (AI) market despite the present slump, they claimed, using high bandwidth memory (HBM) and semiconductor contract manufacturing as examples.
An average of five experts' predictions for its mobile division suggests that it made an operating profit of about 3.3 trillion won, with measures to decrease marketing expenses offsetting a modest decline in smartphone shipments from the first quarter, when Samsung unveiled its most recent flagship model.
Analysts believe Samsung's decision to reveal its most recent foldable handsets in Seoul later this month, weeks earlier than normal, is an attempt to maintain its dominance in the premium phone market before rival Apple publishes its next iPhone.
The IT giant will release its full second-quarter earnings later this month after releasing its early numbers on Friday.
(Source:www.cnbctv18.com)