Samsung, the large technology company, has seen its profits fall 23%, despite good sales of it’s smartphones and strong growth of the mobile phone business. However, Samsung do not just sell phones and their memory chip side of the business didn’t perform well from July to September.
The world’s largest chip maker and second largest mobile phone maker reported a net profit of 3.44 trillion won ($3.1bn) in the third quater of 2011, July to September.
On the other hand the profits from mobile phone handsets was impressive. Profits had doubled to 2.52tn won ($2.28bn) on strong sales of the Samsung Galaxy smartphone range.
Profits in the chip division of Samsung halved to 1.59tn won ($1.44bn). There has been a global decrease in computer memory chips recently and this has heavily affected Samsung. Analysts have said that Samsung’s chip business will probably struggle in the short term.
Park Hyun from Ton Yan Securities said ‘I see some signs that chip prices have hit bottom as inventories are running out. However, we don’t yet know when the industry is going to pick up since macroeconomic uncertainties overshadow the demand outlook’
I have seen the price of RAM drop quite considerably over the lat year. Last year 4Gb PC3-8500 used to sell for almost £100 a module, it now sells for about £25 a module. However, if inventories are running out surely the price will rise due to a lack of supply?