A few years ago Samsung overtook Intel as the world's largest chip manufacturer. Samsung's rise as a chip maker has generated huge revenue for the company due to high demand for semiconductors over the past decade. Today Samsung Electronics announced chip production cuts after the company's profits are forecast to shrink 96% in Q1 2023.
Samsung is estimated to generate only 600 billion won (~RM2 billion) in this quarter compared to 14.12 trillion won (~RM47.1 billion) in the same quarter last year. This is also the lowest income ever recorded by Samsung Electronics since 2009. More troubling is Samsung's chip business which recorded a loss of 4 trillion Won (~RM13.3 billion) while it has been generating high income for the company.
The decrease in income is due to the lack of demand for chips due to world economic factors. Customers are not buying new memory stock because they are also dealing with the problem of lack of demand. As a result, there is stock dumping with plummeting prices. The best situation is like in the middle of the last pandemic.
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BUSINESS & MONEY