Samsung Electronic which is largest smartphone making company in the world yesterday shocked everyone when officials of company said that they are expecting a lesser amount of profit. Samsung’s executives noted that the company is seeing a slight decline in the demand for its major products and that’s why first quarter’s earnings reports might not be that much exciting. One of the primary reason why Samsung might not able to meet upto expectations is because of low seasonal demand in memory products.
Samsung uses memory products in building smartphones and other devices so if there’s weak demand for such products, then it’s evident that Samsung is going to book less amount of profit. However, this is not the first time when Samsung has said something like that. Because in January south Korean tech company announced that they are expecting less amount of profit for the third quarter ending and that’s what happened when earnings reports of Q3 came out.
If we look into other chip-making companies sales, then this market is going through some hard phase because overall the purchase of memory chips is declining at a faster rate which is affecting on Samsung’s other products also. Smartphones produced by Samsung are getting a slow demand since big companies like Huawei, Xiaomi is getting ahead of South Korean company in various regional and global market.
Accordingly, the semiconductor market have been declined by approximately 10.2% from last year, so it means not only Samsung but other companies are also suffering the most. Now some business experts think that export of semiconductors has slowed down in Asian and Western market because of ongoing trade tensions between US-China. The trade war is affecting a lot of semiconductor companies, and it seems like investors of Samsung might have to show some patience.