Samsung's Q1 profit drops 60% from last year

Amid falling memory chip prices and weak demand for display panels, Samsung Electronics Co. on Friday said its operating earnings went down by more than 60 per cent in the first quarter from a year earlier. The operating profit was estimated at 6.2 trillion won ($5.45 billion) in the January-March period, a 60.4 per cent drop from a year ago, Yonhap news agency reported citing earnings guidance. The tech giant expected overall sales to have fallen 14.1 per cent on-year to 52 trillion won in the three-month period.

Samsung did not break down the performances of its respective business divisions, saying it will announce detailed earnings later this month. The operating profit margin of the company stood at 11.9 per cent, the lowest since the third quarter of 2016.  Earnings from memory chip sales accounted for over 70 per cent of the total last year.

Market watchers expected downbeat earnings from its semiconductor business and losses in the display panel division for the first time since 2016.

Samsung is the world's biggest producer of DRAM and NAND flash chips and supplies smartphone panels to Apple, which has suffered tepid sales of iPhones in China.

The IT and mobile business were expected to have posted robust earnings on the back of the Galaxy S10, which went on sale last month. 

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The flagship phone's 5G model was launched in South Korea earlier in the day, targeting the premium segment.