Samsung Elec second quarter profit down 56per cent as chip troubles persist

Samsung Electronics Co Ltd posted a 56per cent drop in second-quarter operating profit on Wednesday, hit by continuing declines in memory chip prices amid oversupply.

FILE PHOTO: A Samsung employee arranges the new Samsung Galaxy S10e, S10, S10+ and the Samsung Gala
FILE PHOTO: A Samsung employee arranges the new Samsung Galaxy S10e, S10, S10+ and the Samsung Galaxy S10 5G smartphones at a press event in London, Britain February 20, 2019. REUTERS/Henry Nicholls

SEOUL: Samsung Electronics Co Ltd posted a 56per cent drop in second-quarter operating profit on Wednesday, hit by continuing declines in memory chip prices amid oversupply.

Operating profit was 6.6 trillion won (US$5.6 billion) in the second quarter, in line with the 6.5 trillion won estimate the company released earlier this month.

The notoriously cyclical memory chip industry is in the midst of a downturn after a two-year boom, as slowing demand for gadgets such as smartphones pulls down chip prices.

Last week, Samsung’s South Korean chip rival SK Hynix said it would cut investment and production to shore up a nascent recovery in chip demand.

(Reporting by Ju-min Park and Heekyong Yang; Editing by Stephen Coates)