News
News Categories

Samsung likely to report first profit drop in two years due to China slowdown

By Cookie Monster - on 8 Jan 2019, 12:00am

Samsung likely to report first profit drop in two years due to China slowdown

The Samsung Galaxy Note9.

The slowing economic growth in China is not only affecting Apple as it is estimated to have an impact on Samsung's fourth quarter earnings report. 

According to Reuters, data from the Institutional Brokers' Estimate System (IBES) suggests a 12% year-on-year drop in operating profit to US$11.85 billion for Samsung. If true, this would be Samsung's first drop in quarterly operating profit in two years! 

“Depressed demand in China will further drive down Samsung’s chip sales there. And China’s overall smartphone market is stalled and declining, which will affect not only Apple but Samsung,” Song Myung-sup, a senior analyst at HI Investment & Securities, told Reuters.

Revenue is estimated to decline 5% due to lower memory-chip shipments. Profit at the smartphone business unit is expected to drop by a fifth as well. The overall operating profit at the chip's business is predicted to drop 3.7% from a year ago. 

Samsung is expected to face more woes this year due to the weakening of the Chinese economy and the ongoing China-U.S trade war.

Source: Reuters

Join HWZ's Telegram channel here and catch all the latest tech news!
Our articles may contain affiliate links. If you buy through these links, we may earn a small commission.