SEOUL, July 6 (Reuters) – Samsung Electronics' (005930.KS) June-quarter revenue is anticipated to plunge 96% on-year to the bottom for any quarter in additional than 14 years, as a chip glut continues to drive giant losses within the tech large's money cow enterprise regardless of a provide lower.
Working revenue for the world's greatest maker of reminiscence chips, smartphones and TVs seemingly fell to 555 billion received ($427 million) within the April-June quarter, in keeping with a Refinitiv SmartEstimate from 27 analysts, weighted towards those that are extra constantly correct.
If that's the case, it might be Samsung's lowest revenue because the fourth quarter of 2008, when Samsung Electronics reported a consolidated working lack of about 740 billion received. It compares with an working revenue of 14.1 trillion received within the April-June quarter final yr.
It's because its chip division, historically its greatest earner, seemingly reported quarterly losses of round 3 trillion to 4 trillion received as reminiscence chip costs fell additional and its stock values have been slashed.
Costs of DRAM reminiscence chips – extensively utilized in smartphones, PCs and servers – continued to slip within the quarter, falling about 13% to 18% in keeping with TrendForce, as chip consumers kept away from buying new chips and used up inventories.
Nevertheless, the value decline slowed from earlier quarters as Samsung Electronics and reminiscence chip friends lower provide, and is anticipated to hit backside across the third quarter, though a considerable restoration won't come till 2024, analysts stated.
Regardless of the present downturn, Samsung is working to extend its share of chip demand from the exploding subject of synthetic intelligence (AI), equivalent to with excessive bandwidth reminiscence (HBM) and chip contract manufacturing, they stated.
Its cellular enterprise seemingly reported an working revenue of round 3.3 trillion received, in keeping with a mean of forecasts from 5 analysts, as efforts to chop advertising and marketing prices offset a slight drop in smartphone shipments versus the primary quarter, when Samsung launched its newest flagship mannequin.
Samsung is anticipated to unveil its newest foldable smartphones later this month in Seoul, weeks sooner than common, seen by analysts as a bid to dominate the premium cellphone marketplace for longer earlier than rival Apple (AAPL.O) releases its subsequent iPhone.
The tech large will announce its preliminary second-quarter earnings outcomes on Friday, earlier than reporting full earnings later this month.
($1 = 1,298.7800 received)
Reporting by Joyce Lee; Modifying by Sonali Paul
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