Samsung’s Q1 2023 Earnings Forecast Spells Trouble Despite Galaxy S23 Success
Samsung celebrates the success of its Galaxy S23 series, with sales surpassing the previous model worldwide. However, the company’s Q1 2023 financial earnings guidance paints a less rosy picture.
Samsung reports an estimated 19% decrease in sales revenue to 63 trillion Korean won from the previous year’s 77.78 trillion won. The operating profit estimates are more concerning, with a drop of over 95% compared to Q1 2022, and the lowest recorded profit in 14 years at an estimated 600 billion won ($450 million USD).
The main contributor to Samsung’s poor financial guidance is the reduced demand for semiconductors, which has affected other chipmakers like Qualcomm. Customers’ slowed demand for new chips has led to increased inventory levels.
To combat the ongoing economic struggles, Samsung will reduce its semiconductor output, stating that they will lower the production of memory chips, especially those with supply secured.
Despite the plummeting profits, Samsung boasts improved sales of its latest flagship smartphone in global markets. The Galaxy S23 series is selling up to 1.7 times more than the Galaxy S22 in Europe, India, the Middle East, and Latin America.
Samsung introduced the latest Snapdragon 8 Gen 2 for Galaxy to power the phones globally. Fans are apparently flocking to the Snapdragon-powered Galaxy, given the flack Samsung has received over its underperforming Exynos chips.
The top-end model, Galaxy S23 Ultra, makes up 60% of sales, as in previous years.
Samsung is expected to release its quarterly earnings report for the January-March period later this month.
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