Samsung’s profit could decline due to memory chip prices

Marco Green
October 8, 2019

The company believes that it will post an operating profit of around 7.7 trillion Korean won ($6.44 billion).

South Korea's biggest company is suffering from the slowdown in its core industry, though analysts say the demand will likely revive as next-generation networks are rolled out.

However, on the positive note, the demand for memory chips has shown sign of improvements in the current quarter.

He also pointed out that Samsung's investment to transform the low-end LCD display production line to OLED manufacturing facilities, which cost about half a trillion won, could be another burden on Samsung's fourth-quarter earnings. Samsung Electronics said its consolidated sales for Q3 fell 5.3 percent to $51.8 billion (₩62 trillion).

Samsung withholds net profit and sector-by-sector business performance until it releases its final earnings report, which is expected later this month.

The Korean technology giant has endured a number of hard quarters in which operating profits have fallen significantly.

Strong sales of Samsung Electronics' Galaxy Note 10 smartphone series are limiting forecast profit falls at the South Korean tech giant, raising hopes it is getting back on a growth track after years of moribund sales. As CNBC noted, if Samsung's forecast is correct, then this will be the third consecutive quarter where its operating profit is halved from the same period a year ago. Also, by increasing the number of stacked layers from eight to 12, Samsung will soon be able to mass produce 24-gigabyte high bandwidth memory, which provides three times the capacity of 8GB high bandwidth memory on the market today.

Samsung appealed to high-end users with the launch of its first foldable smartphone last month after faulty screens forced an embarrassing delay in April. -China trade conflict. "Handset sales of Galaxy 10 and also foldables are doing all much better than expected".

United States sanctions in opposition to Chinese language giant Huawei helped prop up Samsung over the summer, analysts acknowledged, after the South Korean firm's profits dropped not as a lot as feared. Shares in Samsung were up about 1.5%, just slightly ahead of an 0.8% rise in the wider market in afternoon trade.

Other reports by Click Lancashire

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