Samsung on the Mobile World Congress 2023 on March 2, 2023, in Barcelona, Spain. (Photo by Joan Cros/NurPhoto by way of Getty Images)
Joan Cros | Nurphoto | Getty Images
South Korean electronics big Samsung’s working revenue plunged within the first quarter as costs for its reminiscence chips continued to fall and demand remained weak.
Here are Samsung’s earnings at a look within the first quarter:
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Revenue: 63.75 trillion Korean received (about $47.6 billion). That is on par with Samsung’s personal steering of roughly 63 trillion Korean received however under the 63.9 trillion received anticipated by analysts, in accordance with Refinitiv consensus estimates.
Operating revenue: 640 billion Korean received (roughly $478.55 million), down from 14.12 trillion received a yr earlier. The firm issued steering earlier this month saying Q1 revenue can be 600 billion Korean received.
This is the corporate’s lowest working revenue because the first quarter of 2009.
After forecasting a large drop in revenue earlier this month, Samsung mentioned it could be making a “meaningful” minimize in reminiscence chip manufacturing, following the lead of smaller rivals corresponding to SK Hynix and Micron.
“Samsung Electronics announced the disappointing number for the first quarter, but at the same time, they announced a meaningful production cut amid the severe memory chip downturn. After that, the market reacted positively on the news,” SK Kim of Daiwa Securities Capital Markets advised CNBC’s “Squawk Box Asia” on Thursday.
“And yesterday, SK Hynix announced their disappointing number but they also guided it for recovery. If we got a rebound, it’s mostly driven by the production cut and some restocking demand. So we see, despite the disappointing earnings number, some positive investor sentiment on the stock,” mentioned Kim.
Samsung is the world’s largest producer of reminiscence chips, which go into all the things from private computer systems to smartphones to servers in information facilities.
Data from the International Data Corporation confirmed that PC shipments witnessed a steep 29% year-on-year decline within the first quarter, resulting in the drop in costs of reminiscence chips over the previous few months on account of excessive inventories and lack of demand.
During the pandemic, smartphone and PC makers stockpiled chips as demand for shopper units elevated, however they’re now grappling with extra inventories as customers reduce on purchases of those items resulting from rising inflation.
Samsung mentioned it expects restricted demand restoration as large-scale information facilities make investments extra conservatively and prospects proceed to regulate inventories. The firm expects demand to get better steadily within the second half of the yr.
Samsung additionally expects launches of recent smartphones, PC promotions and enlargement of recent CPU adoption to spice up reminiscence chip demand.
This is a growing story. Please verify again for updates.
Source: www.cnbc.com”