Samsung’s revenue within the fourth quarter final 12 months dropped almost 70% from a 12 months prior attributable to low demand for semiconductors and smartphones brought on by the worldwide financial downturn.
The South Korean tech large mentioned in its earnings steering on Friday that it anticipated an working revenue of 4.3 trillion received and a income of 70 trillion received for the fourth quarter of 2022. Income dropped roughly 9% from a 12 months prior whereas working revenue dipped by 69% over the identical time interval.
Additionally, working revenue dropped by greater than half from the third quarter when Samsung saw its first year-on-year profit decline in three years as demand for chips started to weaken considerably.
In a press release in regards to the fourth quarter, Samsung mentioned it noticed a big drop in earnings from the reminiscence enterprise attributable to lackluster demand whereas additionally seeing weaker gross sales of smartphones, amid continued exterior uncertainties together with “a possible world financial downturn”.
The corporate mentioned the decline in demand for reminiscence chips throughout the fourth quarter was better than anticipated as prospects adjusted their inventories to tighten their funds. This additionally brought about the common gross sales costs of chips to drop greater than anticipated, Samsung added.
Extended macro points additionally brought about weak demand for smartphones, the South Korean tech large mentioned, whereas sluggish demand and elevated price burdens for residence home equipment continued.
South Korean analysts largely count on the downturn within the world reminiscence chip market, which is going on after years of excessive progress, to proceed till no less than the primary half of 2023 whereas remaining weak all year long in comparison with 2022.
Samsung’s chip enterprise might even see its first working loss in almost ten years someday subsequent 12 months, in keeping with analysts.
The tech large will announce its full earnings report close to the top of the month.
