It is an unusual step. Although Samsung numbers its concrete business for the last quarter has not yet announced, warns the group before the worst number in the report: 29 per cent broke the profits between October and December compared to the previous year. The reason is not only the Tech sector is still a serious headache.
Because, unlike many would suspect at first glance, it does not bring the collapsing of the Smartphone business, Samsung is under pressure. Instead, the great hope of the last year is, of all things, clearly broke in The business as a supplier of micro-processors.
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From the Cash Cow to the problem child: the Samsung has a Smartphone Problem
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especially in all the Smartphones, computers, servers, and other smart devices built-in memory Chips, had the Koreans in the last year, huge profits. For months, the demand for the small Chips was greater than the supply, the prices rose again and again. Last spring, the Chips made up a whopping 75 per cent of Samsung’s net profit. This now seems to be over.
“We expect revenue to be down in the first quarter of 2019 through the difficult Situation in the storage business,” said Samsung in a Statement. For the last quarter, the decline is quite noticeable: € 8.4 billion profit expected for the fourth quarter, in the three months before, there were almost 14 billion.
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speaks of The “difficult Situation”, of the Samsung, are not expected to be outside of the Tech industry sit up and take notice: The prices for memory chips have fallen currently, more and more companies have reduced orders for memory chips or deleted. The reason is likely to be significantly lower sales expectations in the industry.
In the Smartphone market is watching the. The division has now reached a Plateau, customers use their devices longer and longer, and therefore purchase the more rare a new device. For many manufacturers, the great pressure from Chinese brands, yet it is even worse. Apple, still the third largest manufacturer in the world, not just had to announce that the new iPhones selling so well, as expected, that the demand for the supplied by Samsung memory chips decreases. For Samsung, the Situation is doubly dangerous: With Smartphones and memory chips, the main profit bringer of a break-in at the same time.
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For the world economy much more alarming should be the fact, that the demand for Server-drops Chips. Needed by all website operators, especially large Cloud services are dependent on a steady Expansion of the storage capacity. If this demand decreases, this indicates that the Cloud operators in the medium term, less growth – and this could have major consequences.
With Microsoft, Amazon and Google are three of the four most valuable companies in the Cloud business a huge success. Also, Apple is the fourth in the League – looks at Cloud-services-based Service-division as a key growth area. If this area should grow less than expected, could have globally significant consequences.
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Whether the memory prices continue to fall, will. Currently, the manufacturer could also simply with purchases because they hope to further falling prices. Some of the prices fell so quickly, the were impulse purchases cheaper than long-term contracts, according to the trade page “DRAM-Exchange” according to the “world”. A Situation that appeared a year ago, this was unthinkable.
For customers, the price decline is first of all a good news: The high memory prices have recently triggered that many of the devices fell only slowly in the price. If the purchases for the manufacturer are cheaper, could be resulting in a fall in prices soon.
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