Due to decreasing demand for and slower sales of its microchips, Samsung’s revenues fell noticeably in the fourth quarter of last year. Here are all the specifics regarding the numerous causes of this problem.
According to internal estimations, the South Korean company’s operating profit for the fourth quarter of 2022 would be approximately KRW 4.3 trillion ($3.37 billion), with total revenue of approximately KRW 70 trillion ($55 billion).
Earnings expectations for the company’s fourth quarter of 2022 are in line with recent predictions made by analysts. Revenue is down 9%, and operating profit is down a staggering 69% from Q4 2021. For Samsung, operating profit is at an eight-year low. These disappointing results are the result of a number of factors, including poor sales of smartphones and semiconductor chips globally, which are in turn a result of the worldwide economic slowdown.
These tremendously depressing numbers are the result of lower than anticipated demand for smartphones and semiconductor components, according to Samsung. The company claims that as the external economic environment is projected to continue uncertain, reduced demand from server clients, data centers, and phone makers resulted in a decline in chip sales. An analyst reports that Samsung’s companies across the board are struggling, but Chipsets and smartphones in particular. The group’s sales would have dropped by 8.6% in a single year. We’ll have to wait until 2023 to find out whether things will become better or worse.
Not just Samsung, but all other smartphone makers, including Apple and Xiaomi, are troubled by weak smartphone sales. These poor economic conditions are anticipated to last at least through the end of this year, according to analysts.