Samsung’s Q1 earnings guidance paints a bleak picture for the tech giant, with sales projected to be around $48 billion, down by 10% QoQ and almost 20% YoY. Operating profit is expected to be a mere $455 million, representing a six-fold decrease from the previous quarter and an astounding 95% drop from the $11 billion profit generated during the same period last year.
Samsung has announced that it will significantly reduce the production of memory chips due to persistently weak demand. This poor performance has resulted in the worst profit results for the company since 2009. The decline in profits is not just concerning for the company but also exacerbates economic difficulties in South Korea, where Samsung accounts for over 20% of the country’s domestic GDP.
This marks the second consecutive quarter of significant decline for Samsung. The company had previously attributed the decline to the war in Ukraine and inflation, but it is evident that the company’s profitable streak in memory chips has come to an end. Samsung must now explore other avenues to restore profitability.
It’s worth noting that this is only a guidance report, and actual results may differ from the predictions. However, it’s clear that things are not looking good for Samsung at the moment