Samsung Electronics reported its lowest operating profit in 14 years on July 7, 2023, due to weak smartphone sales and a downturn in the semiconductor market.
The company said its consolidated revenue for the second quarter of 2023 was 60 trillion won, down 22.28% from the same quarter a year earlier. Its operating profit was 60 billion won, down 95.74% from the same quarter a year earlier.
This is the second consecutive quarter that Samsung Electronics' operating profit has fallen below 1 trillion won.
The company's semiconductor division, which is its largest source of revenue, saw its operating profit fall 45.8% from the same quarter a year earlier. This was due to a slowdown in demand for memory chips from smartphone makers.
The company's smartphone division also saw its operating profit fall 41.4% from the same quarter a year earlier. This was due to weak demand for its Galaxy S22 series and increased competition from Chinese rivals.
The company's home appliance division saw its operating profit rise 10.9% from the same quarter a year earlier. This was due to strong demand for its TVs and refrigerators.
Samsung Electronics expects its operating profit to improve in the second half of 2023, thanks to a recovery in the semiconductor market and the launch of new smartphone models.
However, the company faces a number of challenges, including rising inflation, geopolitical tensions, and supply chain disruptions.
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