Samsung has warned of plummeting earnings and plans to chop again on reminiscence chip manufacturing in response to falling demand, The Korea Herald has reported. It expects to earn simply 600 billion received ($455 million) for the primary quarter of 2023, a drop of 96 p.c from the identical interval final yr. It blamed falling demand for reminiscence chips, a state of affairs that could possibly be a nasty signal for the tech business as an entire.
“We’re adjusting to decrease reminiscence manufacturing to a significant degree… along with optimizing line operations which might be already underway,” Samsung mentioned in a press release. It added that it will proceed to put money into clear room infrastructure and increase R&D spending, because it sees improved reminiscence chip demand within the mid- to long-term.
Though it trails Taiwan’s TSMC in different areas, Samsung is the worldwide chief in DRAM and NAND flash reminiscence chip manufacturing with 40.7 and 31.4 p.c shares respectively. Such chips are utilized in client units of all types, starting from smartwatches to cellphones and laptops. The oversupply of reminiscence chips is subsequently an indication that demand for such merchandise has fallen considerably attributable to an ongoing world financial slowdown.
The slowdown comes simply a short while after one of many greatest tech business booms of all time, powered by the COVID-19 pandemic. Since late in 2021, nevertheless, reminiscence costs have dropped by the ground, with DRAM and NAND costs down by 20 and 15 p.c in simply the final quarter alone. One vivid spot for Samsung has been gross sales of its new Galaxy S23 smartphone, which helped bolster earnings, the corporate mentioned. It’ll reveal extra particulars in its earnings report set to drop on the finish of April.
This text initially appeared on Engadget at https://www.engadget.com/samsung-warns-of-lower-profits-amid-falling-demand-for-memory-chips-113551159.html?src=rss
