BREAKING: Samsung Profits Tumble 57%
Samsung has reported a 57% decline in profit, reaching its lowest level since the third quarter of 2016.
The Korean manufacturer reported a net profit of 5.04 trillion won (US$4.4 billion) for Q1 2019, compared to an 11.69 trillion profit won for the same quarter last year.
While the drop in numbers looks grim, profits exceeded analysts’ prediction of 4.9 trillion won net profit.
The last time Samsung profits dipped to this level, the company had issued a global recall of its troubled Galaxy Note 7 after issues with battery temperature.
Last week Samsung was forced to delay the release of its pioneering Galaxy Fold handset, which the company had hoped would boost sales for its mobile division.
An increase in competition in the low to mid-range mobile phone market is being blamed for a decline in profitability, though the company reported “solid” sales of its newly released Galaxy S10.
Samsung flagged increasing competition in the TV and smartphone markets as a challenge for the second half of the year, and is looking to strengthen its standing in the higher-end of the market.
Sales of new premium TVs were expected to boost growth for the Consumer Electronics division.
As the biggest manufacturer of memory chips, Samsung has also been impacted by falling demand amongst data-server clients.
Demand for high-density memory for smartphones increased on the back of new flagships, but the price has been steadily declining, a trend the company expects to continue.
Samsung also expects rising demand for its 5G chipsets as they work to expand their lineup, while the launch of 5G in South Korea using Samsung technology helped bolster earnings for the company’s networks business.