Samsung Electronics (005930.KS) has reported a 34% year-on-year drop in fourth-quarter profit, despite experiencing a rebound in memory prices. The fall in profits was due to weak consumer demand in many businesses. However, the world’s largest maker of memory chips has flagged a continued recovery in memory chips and tech demand in 2024. Samsung expects mobile and PC makers to place more and better chips in devices as the use of artificial intelligence expands. Additionally, the need to replace older servers would also aid a gradual recovery in demand.
Samsung has stated that it expects the memory business to continue to recover in 2024, despite potential obstacles like interest rate policies and geopolitical issues. The company said that the market is expected to recover as demand improves and prices continue to rebound.
In the fourth quarter, operating profit fell to 2.8 trillion won ($2.11 billion), versus 4.3 trillion won a year earlier. Samsung’s chip business swung to a record loss of 14.9 trillion won in 2023 from a 23.8 trillion won profit a year earlier. However, fourth-quarter profit improved from every other quarterly profit in 2023, with losses in the memory chip business shrinking to 2.18 trillion won in the fourth quarter. This was due to memory chip prices rebounding and Chinese PC and mobile makers restocking memory chips during the quarter. Fourth-quarter revenue fell 4% to 67.8 trillion won.