Samsung’s Q3 profits could mark the company’s first YoY decline in years

Market watchers expect Samsung’s profit in Q3 to drop 25% as chip sales continue to decline and consumer electronics demand dwindles. Analysts predict that Samsung is about to experience its first year-on-year quarterly decline in almost three years.

Twentytwo market analysts cited by Refinitiv SmartEstimate (via Reuters) say that operating profit for Samsung likely dropped to 11.8 trillion won ($8.3 billion) during Q3 2022. Meanwhile, the company’s operating profit in the chip business is estimated to have dropped by roughly one-third to 6.8 trillion won ($4.8 billion).

If the estimates are correct, market watchers say this would be the first profit decline Samsung has experienced since Q1 2020 and the lowest quarterly profit since Q1 2021.

In terms of its various divisions, Samsung’s profits from its mobile business might fall 17% to 2.8 trillion won ($1.9 billion), although market watchers say that the Galaxy Z Fold 4 and Z Flip 4 launched in Q3 may have helped to raise the company’s average selling price during the quarter.

Samsung’s smartphone shipments dropped by an estimated 11% in Q3 compared to the year before, or to about 62.6 million smartphones. And as far as the DRAM market is concerned, TrendForce data suggests that prices dropped by 14% in Q3 while NAND flash chips fell by 8%.

Samsung isn’t the only company to have suffered losses over the past few quarters. Market watchers cite rising global inflation levels, fears of recession, and the fallout from the Russian invasion of Ukraine as the primary causes for these results.