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Samsung Q2 profit plummets 56% as smartphone sales slow down

By Anton D. Nagy July 31, 2019, 4:00 am

Samsung has posted its financial numbers for the second quarter of the year, posting 56.13 trillion won ($47.4 billion) in consolidated sales and 6.6 trillion won ($5.58 billion) in operating profit, representing a 56 percent drop.

The slow performance is mostly due to weakening market conditions and poor performance of its memory chips and smartphones. As far as its mobile division is concerned, Samsung managed to ship more budget and mid-range devices, but slowed down in flagship Galaxy S10 shipments, to which increased marketing expenses added more to the plummet.

Overall smartphone shipments increased thanks to strong sales in the mid-range-and-below segment, but flagship sales were slow amid waning launch effects of a new model and sluggish demand in the premium market

Compared with the third quarter of 2018, when Samsung reported its largest-ever quarterly operating profit of 17.57 trillion won, the Q2 figure was reduced to a third, the Korea Herald reports. While its networking branch posted solid results by commercializing 5G gear in Korea, the memory chip branch is struggling “as effects of inventory adjustments by major data center customers in the previous quarters continued, despite a limited recovery in demand“.

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