Samsung has warned of a 32% profit slump as consumers cut on expenditure owing to the global economic slowdown.
The South Korean behemoth reported an estimated $7.6 billion (10.8tn South Korean won) operating profit. The estimates are drawn from the company’s three months’ profits, up to the end of September. This marks Samsung’s first year-on-year decline in quarterly profits in nearly three years.
Samsung projects its operating profit during the October to December period to be around $9.8bn (10.8 trillion won), down 28.7 per cent recorded in the same period last year, the company said earnings estimate earlier this week.
At the same time, US chip maker Advanced Micro Devices (AMD) also said it was hit by a fall in demand for computers. Its chip processor business recorded a significant fall in profits as demand fell across the globe.
“The PC [personal computer] market weakened significantly in the quarter,” AMD’s chief executive Lisa Su said.
The rising inflation has indiscriminately affected investments as consumers cut expenditures and incomes shrink. Analysts say many companies will report reduced profits for the second half of 2022.