INTERNATIONAL – With Samsung Electronics expected to suffer its biggest annual profit drop in at least a decade, investors are counting on an expected uptick in the memory-chip market to cure the tech giant’s ills this year.
When it issues preliminary fourth-quarter results on Jan. 8, the world’s top maker of memory chips used in smartphones, laptops and servers is set to post a 40 percent slump in operating profit to 6.48 trillion won ($5.56 billion), according to Refinitiv SmartEstimate, weighted towards more consistently accurate analysts.
The three months ended December are expected to mark the South Korean firm’s fifth year-on-year decline in quarterly profit, ending a year marred by bloated stockpiles of chips that squeezed prices, and the US-China trade war that roiled global supply chains and prospects for consumer demand.
With 2018 having been a record year for earnings, last year’s slump likely means Samsung posted its biggest percentage drop in annual profit in at least a decade.
But with the United States suspending planned December tariffs on Chinese goods, including mobile phones and laptops, concerns about demand have eased as optimism for the rollout of new 5G networks around the world has grown.