Samsung expects its profits to fall 69% for the last three months of 2022 to their lowest level in eight years.
The world’s largest maker of memory chips, smartphones and televisions forecasts that its operating profit fell to around 4.3 trillion won (US$3.4bn; £2.8bn) for the period.
It comes as the global economic slowdown is hitting memory chip prices and demand for electronic devices.
Tech giants around the world have been hit in recent months as consumers tighten their belts.
It was Samsung’s lowest quarterly profit since 2014, falling short of investors’ expectations of around 5.9 trillion won.
- Amazon plans to cut 18,000 jobs to cut costs
- Samsung warns of 32% profit loss due to chip collapse
The South Korean company said demand for computer chips fell more than expected as customers reduced stocks of key components for digital devices.
“In the memory business, the decline in demand was larger than expected in the fourth quarter as customers adjusted inventory levels to further tighten finances,” Samsung said in the statement.
“Smartphone sales and revenue fell on weak demand amid ongoing macro issues,” it added.
Samsung is expected to release its full financial statements on January 31st.
It’s the latest major tech company to disclose how weakness in the global economy is affecting its business.
Sales have also slowed after demand boomed during the pandemic as shoppers spent heavily online at home.
Tens of thousands of jobs will be shed in the global tech industry as sales slow and concerns of an economic downturn grow.
This week Amazon announced it would cut more than 18,000 jobs, the largest number in the company’s history, to cut costs.
In November, Meta announced it would cut 13% of its workforce.
The first mass layoffs in the social media company’s history will result in 11,000 employees losing their jobs out of 87,000 employees worldwide.
Meta boss Mark Zuckerberg said the cuts are “the most difficult changes we’ve made in Meta’s history.”
The news followed major layoffs at Twitter, which cut about half its workforce after multi-billionaire Elon Musk took control of the company in October.
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