Samsung Electronics' operating profit drops 95.5% in Q1

Samsung Electronics, South Korea's tech giant, recorded a double-digit drop in operating profit in the first quarter due to a huge loss in its semiconductor business, the company said Thursday.

Consolidated operating profit tumbled 95.5 percent over the year to 640.2 billion won (US$477.8 million) in the January-March quarter, falling below 1 trillion won for the first time in 14 years.

Revenue retreated 18.1 percent to 63.75 trillion won, and net income plummeted 86.1 percent to 1.58 trillion won in the first quarter.

The double-digit fall came as overall consumer spending slowed amid the uncertain global economic environment, Samsung said.

Samsung's chip-making unit posted an operating loss of 4.58 trillion won on revenue of 13.73 trillion won in the first quarter.

The continued inventory adjustment in the memory chip sector led to a sharp decrease in product prices amid the global economic slowdown.

The display business logged an operating profit of 780 billion won on revenue of 6.61 trillion won for the first quarter.

The mobile device and networks unit recorded an operating profit of 3.94 trillion won on revenue of 31.82 trillion won thanks to strong sales of the newly launched Galaxy S23 series.

Due to lower global demand, the TV and home appliances division registered an operating profit of 190 billion won and revenue of 14.08 trillion won.