Samsung quarterly profit set to slump 25%

Seoul, The Gulf Observer: Samsung Electronics Co Ltd.’s third-quarter profit could tumble 25%, the first year-on-year decline in nearly three years, as an economic downturn saps demand for electronic devices and the chips that power them.

Globally, inflation is on the rise, central banks are aggressively hiking interest rates. As a result, businesses and consumers alike have reined in spending, Reuters reported.

Operating profit for Samsung, likely fell to 11.8 trillion won ($8.3 billion) in the July-September quarter, according to a Refinitiv Smart Estimate from 22 analysts.

“Being the world’s top memory chip maker, top in TV and mobile OLED displays, and top in smartphone shipments, Samsung is highly sensitive to the economy, with profits easily linked to demand,” said Greg Roh, head of research at Hyundai Motor Securities.

It would be the first profit decline since the first quarter of 2020, and the lowest level of quarterly profit since the first quarter of 2021.

Operating profit for Samsung’s chip business likely fell by nearly a third to 6.8 trillion won ($4.8 billion), an average of seven estimates showed.

Samsung’s mobile business is expected to see profits tumble with forecasts calling for a 17% fall to 2.8 trillion won ($ 2 billion), although the launch of the company’s pricy new foldable phones during the quarter raised the average selling price.