Samsung’s year-end profits plunge  

Biggest drop in 8 years

Samsung Electronics announced that quarterly profits fell by 2/3 , marking an 8-year negative record. The main reason seems to be the weakened global economy, the drop in memory chip prices and the reduced demand for electronic devices.

In fact, Samsung’s profits are expected to decrease further in the current quarter as well.

All of Samsung’s divisions struggled, but especially the chips and mobile divisions.

The detailed financial report of Samsung, Asia’s fourth largest company by market value, will be released on January 31.

Rising interest rates and the rising cost of living worldwide have reduced demand for smartphones and other electronic devices.

For the memory division, the drop in demand in the fourth quarter was larger than expected as customers cut back on spending to control their finances. Memory chip prices fell more than 20% during the quarter, and high-end phones such as foldables fell short of expected sales.

Analysts expect Samsung’s profits to fall further in the current quarter.

The reason shares are rising despite lower earnings is that investors hope Samsung will cut production, as Micron and SK Hynix have done, which will help the memory industry as a whole.