Business
Samsung faces $2.3 billion loss in first two months of 2023: Report
2023 begins as a bad year for Samsung Electronics’ memory chip business as the division lost $2.3 billion in the first two months of 2023. According to koreajoongangdaily source, the company lost 3 trillion won in January-February, and it’s expected to continue throughout the first quarter of 2023.
According to the report, the company estimates that the operating loss could reach up to 4 trillion won by the end of the first quarter. Due to the global economic downturn, it’s going to be the first loss for the division since the fourth quarter of 2008.
“Internally, there was a report projecting up to 4 trillion won in operating losses from the memory chip business in the first quarter,” koreajoongangdaily source said.
Samsung Elec reportedly borrowed 20 trillion won from its Display division to help in the funding of semiconductor investments. The company said that it will maintain this year a similar level of capital expenditure as last year without any plan to “artificially” cut back production of semiconductors.
Among all divisions, the DV division is Samsung’s most profitable business, which was significantly affected at the end of last year. The decreasing semiconductor business is expected to get recovered only after the global shortage and economic downturn lessens.
In 2022, Samsung’s chip division brought in 23.8 trillion won of operating profit. The business’s operating profit came in at 8.5 trillion won in the first three months, 9.9 trillion won in the second and 5.12 trillion won in the third. However, it reduced by 97 percent YoY in Q4 as the division posted a 270 billion won profit.
As per TrendForce report, DRAM prices will likely slide 20 percent in the first quarter and another 11 percent in the second quarter, which already faced a 34 percent decline in 2022. Moreover, NAND flash chips will go down 10 percent in the first quarter and 3 percent in the second.
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