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Samsung predicts smaller-than-expected drop in profit

Posted on Tuesday, January 7th, 2020 By The Associated Press

Emily Becher, senior vice president head of Samsung NEXT Global, speaks about 5G interconnected cities during a Samsung keynote before the CES tech show, Monday, Jan. 6, 2020, in Las Vegas. (AP Photo/John Locher)

SEOUL, South Korea (AP) — Samsung Electronics Co. said Wednesday its operating profit for the last quarter likely fell 34% from a year earlier, which would be a smaller-than-expected decline possibly resulting from increased smartphone shipments and gradually stabilizing computer chip prices.

The South Korean tech giant estimated an operating profit of 7.1 trillion won ($6 billion) for the October-to-December quarter, which would represent a 34.26% drop from the same period last year.

Samsung said its revenue likely dropped 0.46% to 59 trillion won ($50 billion), but it did not break down its performance by business division. It will do when it releases a finalized earnings report later this month.

Samsung, the world’s biggest producer of smartphones and semiconductors, has suffered a sharp drop in profit over the past year with an industry-wide glut forcing chip-makers to slash prices to clear out inventory. The company estimated an operating profit of 27.7 trillion won ($23.5 billion) for the full-year 2019, which would represent 53% drop from a year earlier.

Analysts say there are signs that the global market for memory chips is beginning to stabilize due to increase demands in servers and mobile devices.

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