Samsung's profits collapse as it warns of future "challenges"

Samsung Electronics' profits fell in the second quarter due to the downturn in its core chip business. The company has also warned of future "challenges".

The world's largest maker of smartphones and memory chips said its operating profit had dropped 56 percent over the previous year.

The results reflect a general slowdown in the industry, affected by the trade war between the United States and China.

The company is also facing a possible disruption of its chip business due to a commercial conflict between Seoul and Tokyo.

The South Korean company posted operating profit of 6.6 billion won ($ 5.6 billion, 4.6 billion pounds sterling) for the quarter to June, down 56 percent from 14, 87 billion Korean won recorded in the same period of the previous year. The result was in line with the company's estimates.

In a statement, Samsung said the weakness and price declines in the memory chip market were continuing "despite a limited recovery in demand."

"The company faces uncertainties related to uncertainties not only in the business sectors but also in the changing global macroeconomic environment," he said.

Japan has recently imposed export restrictions on some of the industrial materials that Seoul needs to manufacture semiconductors and display screens.

This decision raised concerns about the risk that trade represents for global technologies and could affect Samsung's future earnings.

The company also announced that it would focus on launching new products in the third quarter, including its first collapsible smartphone, which had a difficult start.

Samsung had to delay the launch of its new foldable smartphone earlier this year as a result of information reporting broken screens.

The flaws in this device have been a source of embarrbadment for the company, which has seen a decline in smartphone sales and faces growing competition from competitors such as Huawei.

Last week, Samsung announced that the Galaxy Fold would go on sale in September after improvements to the smartphone.