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  • Writer's pictureBy The Financial District

Samsung Profits Crash By 95%

Samsung Electronics, the world’s biggest memory chipmaker, said operating profit fell to 640 billion won ($478.6 million) for the January-March quarter, down 95% from 14.12 trillion won a year earlier and the lowest profit for any quarter in 14 years, CNN reported.

Photo Insert: Shoppers around the world have cut back on purchases due to rising inflation resulting in chip prices plunging by about 70% over the previous nine months.

Revenue fell 18% to 63.7 trillion won. The South Korean tech giant’s chip division — normally its most reliable cash cow — reported a 4.58 trillion won loss compared to an 8.45 trillion won profit a year earlier.

Shoppers around the world have cut back on purchases due to rising inflation.

As a result, smartphone, personal computer, and server companies have run down inventories, causing chip prices to plunge by about 70% over the previous nine months, Reuters also reported.

Despite the record loss in chips, Samsung said it spent 10.7 trillion won in capital expenditures during Q1, the highest for the first quarter of any year.

All the news: Business man in suit and tie smiling and reading a newspaper near the financial district.

Out of that, 9.8 trillion won was spent on chips as Samsung sets up production in its Taylor, Texas, and Pyeongtaek, South Korea factories.

“Samsung Electronics will continue to invest in memory semiconductors at a similar level to the previous year … to secure mid- to long-term competitiveness,” it said.

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