The final three months of 2022 are reportedly projected to see Samsung Group's profits decline by 69% to their lowest level in eight years. The largest manufacturer of memory chips, cell phones, and TVs in the world anticipated a drop in operating profit to about USD 3.4 billion for the time.
Sources claim that this occurs as the recession in the world economy affects the cost of memory chips and the demand for electronic devices. As customers tighten their belts, global technology titans have recently taken a hit.
Surprisingly, Samsung's quarterly earnings hit record bottom since 201,4 and fell short of investor estimates by about USD 4.65 billion.
The South Korean business claimed that when clients reduced their supplies of the essential parts for digital gadgets, there was a greater-than-anticipated decline in demand for computer chips.
And with customers changing their inventory in an effort to further tighten their budgets, the fall in demand for memory products in the fourth quarter was way larger than the company had envisaged.
As per company statement, it believes that smartphone sales and revenue declined due to sluggish demand brought on by persistent macro difficulties. However, on 31st January this year, it will be releasing its complete financial statement where more details will be shared.
Sales have also plummeted after the pandemic's spike in demand when consumers at home invested a significant amount of money online.
It is worth noting that Samsung joins the latest wagon of significant technological corporations to discuss the effects of the global economic downturn on its operations. Tens of thousands of jobs are being lost throughout the IT sector including prominent firms that have issued mass layoffs like Amazon, Meta, and Twitter, as a result of disappointing sales and mounting worries about a recession.
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