The South Korean electronics giant said net profit in the quarter ending Sept. 30 was 6.29 trillion won ($5.4 billion), down 52% from the same period a year ago. The company attributed the decline to weaker demand for memory chips but said demand should recover in the near future as customers stockpile chips amid uncertainty in global trade. South Korea, for example, is embroiled in a trade war with Japan, which could make Samsung’s memory chips more expensive in the future as they rely on Japanese-made components.
Samsung also said it expects to see strong demand for other products like solid-state drives, image sensors and OLED displays due to the release of more 5G smartphones next year and faster adoption of new display technologies.
Investors appeared to have mixed feelings about Samsung’s forecasts, leaving the company’s share price unchanged from a day earlier. It remains to be seen whether global smartphone demand can overcome the amount of oversupply in the memory-chip industry, which has caused prices to decline all year.