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Samsung Electronics said on Tuesday its profit plunged nearly 70% in the last quarter as a weak global economy curbed demand for its consumer electronics and computer memory chips.
The company’s operating profit for the three months to December was 4.3 trillion won (£2.8 billion), down 69 percent from a year earlier and its lowest quarterly profit since the third quarter of 2014.
Revenue fell 8 percent to 70.46 trillion won (£46.25 billion).
As Covid-19 forced millions to work from home, strong demand for PCs, TVs and the chips that power computer servers allowed the South Korean tech giant to thrive in the first two years of the pandemic, helped by its zero Double advantage in parts and finished products.
But the company has had a harder time weathering the economic shock from Russia’s war in Ukraine, which has disrupted industrial supply chains and left major economies mired in rising inflation and slowing growth.
“The business environment deteriorated significantly in the fourth quarter due to weak demand due to a slowing global economy,” Samsung said in a statement.
Chip prices fell sharply on weak demand as customers adjusted inventories in the face of “increasing uncertainty” in the global economy, Samsung said, a problem it said could extend into the first quarter of 2023.
Samsung also expects demand for its smartphones and TVs to fall further in the first quarter amid a sluggish global economy.
Samsung shares fell 3.5 percent on Tuesday.
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