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Samsung’s First-Quarter Profit Declines 60% On-Year As Low Chip Costs Bite

Recently, South Korea’s Samsung signaled enhanced second-half outcomes on hopes of a pickup in smartphone and memory chip sales, after reporting its weakest profit in over 2 Years in the first quarter. The major manufacturer of semiconductors globally, however, cautioned of more short-term impact in the second quarter, with memory chip costs likely to lower further before a bounce back in demand as the data centers re-stocks later in the year. In a statement, the tech giant stated, “For the second half of 2019, the company anticipates memory chip stipulate for high-density products to surge, but indecisions in the external surroundings would persist.”

Hit by declines in chip costs and slowing order for display panels, Samsung reported operating income of $5.4 Billion (6.2 Trillion won) in the quarter that ended in March, which is a smallest since 2016 but on track with the company’s guidance. The revenue decreased by 13.5% to 52.4 Trillion won, which is also on track with its previous estimates. The company’s core semiconductor business reported a 64% fall in operating income to 4.1 Trillion won, whereas the display business recorded loss of 560 Billion won. Seemingly, memory chip manufacturers have been punched by a slump in the international smartphone market and a decline in demand from data centers following cloud computing services amid a wider economic slowdown.

Similarly, Samsung was in news for fixing sign-in issues with its Galaxy Wearable application. The Samsung Galaxy Wearable application was down for many days starting over the weekend, with thousands of users reporting update and login issues. The issue impacted Samsung Galaxy Watch Active watches, with the application freezing on a white screen, once users try to sign in on their phones. The company had fixed the sign-in bug, as per to a user report on the Samsung forums.

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