Samsung Profit to Fall 56% in Q2

Samsung warned investors that its Q2 2019 profit is likely to fall 56 percent following the company's slow demand for memory chips and smartphones.

The tech giant said earlier this week that it anticipates an operating profit of $5.6 billion for the quarter ended last June, down from $12.7 billion for the same period a year earlier.

The South Korean company is known for supplying display screens to many other smartphone makers such as Apple.

However, Samsung's profits have dipped extensively over the past year following a drop in memory chips market demand.

The company's earnings before interest rates and taxes (Operating Profit) fell last quarter to its lowest level since the fallout of the Galaxy Note 7 exploding and catching fire incidents in 2016.

In the meantime, Rick Seo, an analyst with HSBC said that the slow demand and big supply for memory chips have created a 'tough' situation for Samsung.

Analysts pointed out that declining sales of the Galaxy S10 and flagship phones will drive revenues even lower.

[caption id="attachment_63248" align="aligncenter" width="768"] Samsung's Galaxy 10 smartphone[/caption]

Samsung is the world's largest smartphone seller. It is producing key components for rivals and is currently intensifying its 5G network business.

However, the company can be a potential winner in light of the current difficulties facing rival Huawei.

Huawei is the world's largest telecommunications equipment maker and the second-biggest smartphone seller.