SEOUL (dpa-AFX) - Samsung Electronics Co Ltd (SMSN.L, SSNNF.OB, SSNLF.OB) reported a profit for the second quarter that dropped about 54 percent from last year, due to falling memory chip prices. Quarterly operating profit also dropped 56 percent from last year, while sales decreased about 4 percent.
'The weakness and price declines in the memory chip market persisted as effects of inventory adjustments by major datacenter customers in the previous quarters continued, despite a limited recovery in demand,' Samsung said in a statement.
Looking ahead to the second half, the company expects persistent uncertainties in the memory business, although demand is seen growing further on strong seasonality and adoption of higher-density products.
For the second half, Samsung expects a further recovery in mobile displays from stronger sales and higher production, as major customers are planning to launch new products.
For system semiconductors, higher demand in mobile APs, image sensors and display driver ICs is also expected to be seen.
For displays, new smartphone product launches are set to help mobile display earnings but overall sluggish demand in the broad smartphone market may limit upside potential, the company said.
The company plans to enhance its product lineup and expand sales of new mass market models, as competition in the smartphone market is seen increasing in the second half.
In the second half, the overall mobile market demand is expected to remain weak due to growing uncertainties over the global economy and trade.
Samsung said it will focus on successful launches of new products - the Galaxy Note 10 and Galaxy Fold- in the third quarter.
The company reported that net income attributable to the shareholders of the parent company for the second-quarter of 2019 dropped 53.88 percent to 5.06 trillion Korean won from 10.98 trillion won last year.
Quarterly operating profit declined 55.63 percent to 6.60 trillion won from 14.87 trillion won last year.
Sales for the quarter decreased 4.03 percent to 56.13 trillion won from 58.48 trillion won in the prior year.
The Semiconductor Business posted consolidated revenue of 16.09 trillion won and operating profit of 3.4 trillion won for the quarter.
The Display Panel Business reported 7.62 trillion won in consolidated revenue and 0.75 trillion won in operating profit for the quarter.
The IT & Mobile Communications Division posted 25.86 trillion won in consolidated revenue and 1.56 trillion won in operating profit for the quarter.
Copyright RTT News/dpa-AFX
© 2019 AFX News
