This brings profits down to Q4, 2008 levels, when Samsung reported a loss of about 740 billion won, or a tad more than $567 million (via Reuters). What are the Q2, 2023 results in money terms? The operating profit for the world’s biggest maker of digi-goods like memory chips and TVs is said to be 555 billion won, or $427 million in the April-June period.
For the same period in 2022, Samsung reported 14.1 trillion won profit, or close to $11 billion.
But why is Samsung making billions instead of trillions?
According to analysts, this is most likely due to the chip superabundance. Usually, Samsung’s chip division is the company’s golden goose, but in 2023, the Korean masters are hitting market obstacles: the memory chip prices are falling further. Such memory chips are fundamental to the manufacturing not only of smartphones, but also of computers and servers.‘The price decline is expected to hit bottom around the third quarter, although a substantial recovery might not come until 2024’, analysts predicted.
Let the chips fall where they may (but best – in AI)
Samsung absorbs this 96% year-on-year profit drop without fussing around. Instead, the company is planning to significantly increase its share of chip demand in the hot AI field. The artificial intelligence department is in need of HBM chips (high bandwidth memory), as well as chip contract manufacturing, experts said.
Phones are O.K.
While the overall financial picture is not that great, Samsung is likely to report an operating profit of approximately 3.3 trillion won (around $2.5 billion) from its mobile business. This is possible due to marketing cuts the giant applied and compensated for a slight drop in overall phone purchasing.
Less than three weeks are left until the Samsung Unpacked event (July 26) and if you’re interested in pre-ordering the Z Flip 5 or the Z Fold 5, now is the time – you are also eligible to get $50 in Samsung Credit. Read more about the process in detail in our dedicated article.
