Samsung profit likely lowest in more than 14 years as chip glut persists

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Samsung Electronics' June-quarter profit is expected to plunge 96% on-year to the lowest for any quarter in more than 14 years, as a chip glut continues to drive large losses in the tech giant's cash cow business despite a supply cut.

Signage is seen at Samsung 837 in Manhattan, New York City, U.S., November 23, 2021. REUTERS/Andrew Kelly/File PhotoJune-quarter profit is expected to plunge 96% on-year to the lowest for any quarter in more than 14 years, as a chip glut continues to drive large losses in the tech giant's cash cow business despite a supply cut.

If so, it would be Samsung's lowest profit since the fourth quarter of 2008, when Samsung Electronics reported a consolidated operating loss of about 740 billion won. It compares with an operating profit of 14.1 trillion won in the April-June quarter last year. Prices of DRAM memory chips - widely used in smartphones, PCs and servers - continued to slide in the quarter, falling about 13% to 18% according to TrendForce, as chip buyers refrained from purchasing new chips and used up inventories.

Despite the current downturn, Samsung is working to increase its share of chip demand from the exploding field of artificial intelligence , such as with high bandwidth memory and chip contract manufacturing, they said.

 

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