Korean tech giant Samsung Electronics (SSNLF) has warned that it expects a 96% profit plunge in the second quarter due to weak demand for its memory chips.
Samsung, which is one of the world’s biggest microchip designers and manufacturers, estimates that its operating profit in Q2 will be 600 billion Korean won ($459 million U.S.), down nearly 100% from 14.1 trillion Korean won a year earlier.
If the forecast proves accurate, it will mark the company’s lowest quarterly profit since the first quarter of 2009 during the global financial crisis, according to the company.
The company’s second-quarter profit forecast is aligned with analysts’ expectations for 555 billion Korean won, according to Refinitiv data.
Samsung also forecasts Q2 revenue of 63.75 trillion Korean won, down 17% from 77.2 trillion Korean won a year ago.
The company said it stockpiled memory chips as demand for consumer devices increased during the pandemic boom in smartphone and personal computer sales.
That has left Samsung with a glut of memory chips and forced the company to cut its current memory chip production.
Samsung is scheduled to release its Q2 earnings on July 27. The company’s stock has risen 19% over the last 12 months.
