South Korea's Samsung Electronics, the world's largest maker of chips and smartphones, said on Tuesday its first-quarter net profit was down from declining demand for its major products and exacerbated competition.
In the period from January to March, Samsung's net profit reached 5.040 trillion won (3.9 billion euros), a fall of 56.9% year-on-year, according to the group. Turnover decreased by 13.5% compared to the same period in 2018 to 52,400 billion won (40.4 billion euros).
Samsung Electronics is the flagship of the Samsung Group, by far the largest of South Korea's largest family conglomerates, whose health is vital to the 11th largest economy in the world.
The company's profits have tended to withstand in recent years, despite a series of setbacks, including a humiliating series of product recalls and the imprisonment of its chief executive. But its profitability is under strong pressure due to the increase in the global supply of electronic components, while demand is shrinking.
Samsung Electronics also faces increasing competition in the smartphone market from its Chinese rivals offering lower-priced equivalent products such as Huawei, which surpassed Apple in 2017 and now ranks second in the world. .
"Mobile devices have suffered from slow demand and increased competition," Samsung Electronics said in a statement. "The big screens also showed the effects of a drop in the price of LCD panels in a context of bad seasonal results," he added.
Samsung had to resolve, April 23, to postpone the release of Fold Fold smartphone, presented as a technological feat, because of screen problems.
? 2019 AFP