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Samsung Q1 profits plummet with reduced chip demand



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Samsung Electronics posted its low profit margins since the Galaxy Sources 7 defeat in the first quarter of 2019 due to sluggish demand for memory, the company announced.

South Korean tech giant posted operating profit 6.23 trillion won and 52.39 trillion won revenue in the first quarter, a drop of 60.2% and 13.5% respectively from a year ago.

Samsung said the lowered demand for its memory chips and displays have been the main reasons for sharp decline, while its mobile business saw an increase in profit due to hard sales Galaxy S10.

the company's chip business is still its greatest contribution however, adding 4.12 trillion won in operating profit, while the mobile business Samsung earned 2.27 trillion won.

Its display business, meanwhile, saw operating loss of 560 billion won and sales of its consumer electronics to compensate for this with an operating profit of 540 billion won. Operating income of the consumer electronic business of the company were due to strong sales of its QLED TVs.

QLED TV company showed an increase in profitability due to lower prices of LCD panels and increased demand for TVs larger than 65 inches.

At the same time, its display business suffered from lower than expected demand for the OLED-panels aimed at smartphones due to weak sales of iPhones from its major client of the company Apple's, while its large-sized Liquid Crystal Display suffered a huge price falls due increased capacity of the Chinese competitor BOE.

Samsung said demand for its OLED-panel recovers to go ahead with the launch of flagship phones from customers.

business memory chip Samsung, helped the company clinch a record profit in the last two years. But memory chips, in fact, a product that has traditionally gone up cycles and down cycles, is being held down cycle.

The company expects that the demand for memory chips to increase in the second half of the year, but uncertainty remains.

logic chip company is the Samsung, saw an increase in profits from sales of application processors, but this is probably due to the great demand for S10, the company said. Earlier this month, Samsung announced that it will invest $ 120 billion in its logic chip business for the next 10 years to balance its revenue streams in the long run. The company also announced progress in the development of 5nm EUV process for clients.

In the mobile phone, despite the strong performance of the Galaxy S10, heated competition in the low to medium end profitability hurt, the company said. The world's largest smartphone manufacturer put more emphasis on its mid-range phones in recent years, for example, by the introduction of A80 series to compete with Huawei and Xiaomi, especially in Southeast Asia and India.

Earnings for its network business also increased, thanks to 5G commercial launch in South Korea, with Samsung with the & # 39; is the biggest seller for it.

Samsung is not the direct links in a report came to the Galaxy accordion, which has seen its launch will be delayed due to a defect review unit. Before deciding whether to delay the launch of the Galaxy fold, the company said it expected to move more than a million units.

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