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Samsung Revenue For Q1 Expected to fall - Its Lowest in Two Years

April 5, 2019 | Friday

Tech

   

Samsung Electronics, on Friday, talks about its quarterly profit heading at its lowest in more than two years. That due to the slowing panel sales, increasing competition in smartphone hitting its margin, and oversupply in memory chips.

According to Samsung, its operating revenue is believed to fell at about 60 percent compared to the year earlier. Therefore missing its market expectations and at the same time, driving its path on its lowest since 2016.

Despite that, there are numbers of investors looking forward to an earnings recovery and further improvement in chip prices for the second half of 2019. As a result, the Korean tech giant's shares went slightly up before its paring gains went flat.

Samsung's semiconductor production is its main profit generator. Meanwhile, its quantities of memory chips and screens are used to its own smartphones and Apple. Moreover, its server chips are for cloud business companies including Amazon.

Samsung files its January to March profit at about 6.2 trillion won. That equivalent to $5.5 billion. There was a missing 6.8 trillion won as estimated by the Refinitiv SmartEstimate.

An analyst at KTB Investment and Securities, Kim Yang-Jae said, "In the second half, memory chip prices will have a soft landing, so falls will slow, and the release of new iPhones later seems like a good sign for Samsung's display and memory chips."

The Korean tech giant is likely to drop about 14 percent compared to the previous year's revenue. That amounts to about 52 trillion won. Samsung will reveal it's detailed earning in late April.

The firm has warned earlier regarding the failing quarter revenue because of the drop in memory prices. In addition, Apple's iPhones are slowing its demand on display panels. At one hand, it results in steady shares from 01:20 GMT. On the other hand, its broader market went up by 0.2 percent.

As of now, Samsung's Galaxy smartphones still struggle on generating profits as costs of innovation rise, Chinese competitors, and lack of customer interest to upgrade.

   

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