Samsung Blames Poor Quarterly Results on Inflation

Samsung Blames Poor Quarterly Results on Inflation

Samsung has had one of its worst quarters in a decade. According to the South Korean group, many people are holding back when it comes to a new smartphone now that life has become more expensive and the economy is deteriorating.

The company immediately adds a forecast. “Amid ongoing geopolitical concerns, ongoing inflation and the ongoing economic slowdown, we expect the smartphone market to contract in 2023,” said Samsung vice president Daniel Araujo in a statement to his company’s quarterly results. He also thinks that the chip market, which has been in trouble for some time, will probably only show an initial recovery in the second half of this year.

Last quarter, Samsung suffered from weak demand for memory chips, smartphones and displays, as consumers spent less on electronics due to high inflation. As a result, the company saw its profit drop sharply in more than ten years.

Operating profit, which is still adjusted for various items, including taxes, fell 69 percent to 4.3 trillion South Korean won. That is converted to 3.2 billion euros. According to Samsung, the figures show that the ‘business environment has deteriorated significantly’.

Still, Samsung does not want to be fooled regarding investments. He wants to keep the company up to standard despite the gloomy expectations. By continuing to spend a lot of money now that the economy is down, Samsung seems to want to increase its lead over smaller rivals. Chip companies such as American Micron Technology and the South Korean SK Hynix recently said that they would reduce their expenditure on new factories and equipment.

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