Samsung Electronics reported on Wednesday that third-quarter operating profit may fall 78% as the ongoing impact of a global chip supply glut causes the South Korean technology giant’s cash cow business to post losses.
In a brief preliminary earnings statement, the world’s largest maker of memory chips and smartphones forecast operating profit for the July-September period to fall to 2.4 trillion won (IT) from 10.85 trillion won a year ago.
That’s largely in line with some analysts’ predictions that smartphone and PC makers have been avoiding buying new memory chips due to concerns about an economic recession, instead choosing to use up existing inventories within months. Analysts say their inventories are low enough now and expect demand to rebound early next year.
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