Samsung's profits due to slowing demand for memory chip and smartphone

It was so good for SAMSUNG in 2018, until the Christmas call and the South Korean technology company suffered a sharp decline in profits after three months of brutal memory losses.

This drop in chip demand, which Sammy is managing in the semiconductor business, has been described as guilty of falling corporate profits, which, according to Samsung's predictions, was going to happen.

Samsung's results for the fourth quarter of 2018 showed revenues of 59.27 billion won (about 40.5 billion pounds sterling), down 10 percent from the same quarter of 2017. Operating income decreased 29% to 10.8 billion won (£ 7.3 billion)), which is not an amount you could easily get in petty cash.

Nevertheless, a decline is a decline and Samsung has accused "macroeconomic uncertainties and adjustments of inventory levels" in its memory activity.

It seems that Samsung has mistreated the general slowdown in smartphone sales in 2018, which means that the demand for memory chips for smartphones has decreased. Since a phone two years ago is still pretty decent for all but the most demanding applications, we are not surprised that this is the case.

Unfortunately for Sammy, smartphone sales are not expected to increase much in the first quarter of 2019 as people tighten their belts after wandering in Christmas presents or waiting to see what the MWC 2019 will throw up.

But with the Galaxy S10 on the horizon, Samsung hopes that consumers will be caught in a buying frenzy and that its revenues will increase in the second quarter of the year.

"Global smartphone shipments are expected to remain at a similar level, as shipments of the company's consumer models have temporarily decreased due to a reorganization of the lineup." This reorganization is underway to better respond quickly to changing trends. Fast market and customer needs to target customers, "said Samsung.

"For all of 2019, smartphone demand is expected to remain at the same level as in 2018, while the ASP's market is expected to increase due to the trend to adopt higher-end features such as as big screens, increased memory capacity and multi-camera cameras. " The environment will remain globally difficult due to the slow growth of the global smartphone market and the burden of material costs. "

This is not the most glowing prospect, but we are not sorry for the company that has reported operating profit of £ 40.2 billion for the whole of 2018. This amount could probably give the company the ability to retreat itself for a small island sound somewhere and spend its twilight blowing water fish with dismal combos Note 7. μ