Samsung is another of the companies that is noticing the multiple economic problems that are causing inflation, the war in Ukraine and the economic recession that is currently affecting the Asian market, and more specifically, China.
As reported Reuters, the South Korean company forecasts a drop in revenue of 8,400 million dollars during the third quarter of 2022. It would therefore imply a 25% decrease in income compared to the same period of the previous year.
And it is confirmed that it will be the first time in three years that Samsung has announced a drop in revenue in its quarterly results, something that already happened during the first quarter of 2020, when the pandemic began.
The company’s revenue, however, depends not only on the sale of its electronic devices to the public, but also on the sale and distribution of its technologies, such as chips, panels, or other components, to third-party manufacturers.
These, precisely, have noticed how the demand for their products has decreased due to the economic crisis. They don’t produce as many devices as they used to, so they don’t need to order as many components from Samsung.
Samsung’s chip business, the most affected
The South Korean company would also have been harmed in its chip divisionin which analysts forecast revenue of just 6.8 billion won (about 4.9 billion euros). It would therefore mean a year-on-year drop of 30%.. This is not only due to low demand from other manufacturers, but also due to declining prices for these components. In fact, and according to data from TrendForce, DRAM prices have fallen by 14%. Those of flash memories have also decreased by up to 8%.
Samsung could also announce a revenue drop in your mobile business, with earnings of just 2.8 billion won. It would therefore represent a fall of 17% compared to the same period of the previous year. We must take into account, yes, that these data are only estimates by analysts. Samsung will present its results for the third quarter of 2022 in November. In any case, and taking into account the factors that are affecting the economy, everything seems to indicate that the firm will not announce good results.