Samsung Electronics Co. said Tuesday its net profit plunged 56.9 percent in the first quarter from a year earlier due to softening memory chip prices and weak demand for display panels.
The South Korean tech giant posted a net profit of 5.04 trillion won (US$4.3 billion) in the January-March period, the lowest since the third quarter of 2016, its regulatory filing showed.
Its operating profit dropped 60.1 percent on-year to 6.2 trillion won, and sales slipped 13.5 percent to 52.4 won over the cited period, it said. The figures were in line with its market guidance released earlier this month.
The world's largest memory chip and smartphone maker had warned investors of weaker-than-expected quarterly earnings, citing sluggish memory chip and display sales.
Samsung is the world's biggest producer of DRAM and NAND flash chips, and a major smartphone panel supplier for U.S. tech giant Apple Inc., which has suffered tepid sales of iPhones in China.
DRAM chip prices, mostly used in computer servers, fell more than 20 percent on average in the first quarter compared with three months earlier as major data centers have been adjusting their high inventory levels of memory chips, market tracker DRAMeXchange said, seeing no rebound in the near term.
Prices for NAND memory, which is used in mobile devices for data storage, were also hurt by slowing smartphone demand as more consumers are waiting longer to replace their handsets.(Yonhap)