Samsung has announced its Q1 2023 earnings today and they're in line with the guidance it had provided earlier. The operating profit of Samsung Electronics is down 95% compared to the same period last year. This is Samsung's smallest profit for any quarter in 14 years.
Conditions may improve only slightly in Q2 2023
Samsung posted 63.75 trillion Korean won ($47.6 billion) in revenue this past quarter, down 18% compared to KRW 77.8 trillion (around $61.19 billion) in Q1 2022. 640 billion Korean won (roughly $478.55 million), down a massive 95% from KRW 14.12 trillion (around $11.10 billion) in the same period last year.
The lack of demand for chip products is the primary reason for Samsung's profit being eviscerated. Its chip division posted a 4.58 trillion won ($3.41 billion) loss for the quarter as the demand declined considerably and memory chip prices fell by nearly 70% over the past nine months.
Samsung doesn't expect the conditions to improve considerably in the current quarter, only projecting a limited recovery for Q2 2023. It does forecast that companies may start accumulating chips ahead of the third quarter, and that could contribute to a nominal earnings recovery.
The company's mobile division performed better in comparison. Its revenue is up 22% compared to the previous quarter and the operating profit is up 3% compared to Q1 2022. This is a testament to the success of the Galaxy S23 series, as Samsung points out that its new premium models brought in strong sales.
The company intends to continue supporting the steady sales of the Galaxy S23 series while also boosting sales of new mass-market devices like the Galaxy A54 and the Galaxy A34.
