It’s been a long time since there was such a bad result

Even at Samsung, things aren’t going so well: For the first time in three years, the group has made less profit. Samsung is clearly feeling the effects of the weak PC and memory market – but smartphones are still selling well.

Samsung with a significant drop in profits

Samsung has in the third quarter of 2022 made noticeably less profit than before. Above all, the falling demand for memory chips has meant that the surplus has fallen by a full 23.6 percent year-on-year to around 6.6 billion euros. It is the first decline in three years. In terms of sales, however, Samsung was still able to increase its quarterly earnings by 3.8 percent to 53.8 billion euros. Annual sales are expected to be higher than in 2021.

Samsung explains that earnings from the memory business in particular have declined. In the months of July to September, the operating profit of the semiconductor division went down down by almost 50 percent. A year-on-year comparison shows a 14 percent drop in sales.

After the extreme chip shortage during the COVID-19 pandemic, there has been one in recent months Oversupply of memory chips, which in turn has led to a fall in prices. NAND chips are expected to drop in price by up to 20 percent in the fourth quarter of 2022.

According to Kyung Kye-hyun, co-CEO of Samsung Electronics and head of Samsung Semiconductor, the group also sees chips no clear impetus for the coming year. Samsung wants to increase production of high-end memory chips used in servers. Demand for such chips is expected to remain higher.

Samsung is a huge corporation that makes almost everything:

Samsung cell phones continue to be popular

When it comes to mobile devices including smartphones, Samsung faces significantly fewer problems. In the third quarter, the operating profit could even be increased from previously 1.84 billion euros to 2.27 billion euros. In particular, the flagship models such as foldable smartphones have contributed to the success (source: Samsung).