Computer slump knocks 10% off Samsung profits

Samsung Electronics said yesterday that its profits had fallen by two-fifths because of of a slump in memory chip prices.

The South Korean technology giant said that it had been forced to cut prices every two weeks in order to attract customers in the first three months of the year.

The first-quarter profit figure was worse than investors had expected, with weak demand for computer equipment seen as the main factor.

However, shares in Samsung, which is the world's top memory chip maker but also makes a wide range of electronics products, rose.

The company called the outlook "cloudy", but said PC demand might pick up soon and cash-strapped rivals makers were unlikely to add capacity at their semiconductor factories.

The company, best known for sleek colour-screen mobile phones with features such as tiny cameras and voice dialling, said handset sales rose 14 per cent from the previous quarter.

Average selling prices slipped 5 per cent as it shifted its focus to lower-cost phones to boost its market share, but this should rebound later in the year when it rolls out new top-of-the-range models.

Samsung has doubled its share of the global handset market to 10 per cent in two years, overtaking Germany's Siemens and Sony Ericsson. It is now challenging the mobile phone giants Motorola and Nokia. The company sold 13.2 million mobile phones in the first quarter, up from 11.6 million in the fourth quarter.

Growth in this division is being driven by innovative designs, cutting-edge technology and aggressive marketing in Europe and the United States. Samsung said it aimed to sell 13 million mobile phones in the second quarter and 52.5 million for all of 2003.

Samsung earned a 1,130bn won ($937.7m) net profit in the first quarter, falling short of analysts' consensus forecasts of 1,370bn won. This compared with a 1,910bn won profit a year ago.

Turnover fell to 9,600bn won from 9,930bn won.

Samsung shares rose 4.3 per cent to close at 315,000 won on the back of a global technology rally triggered by a solid handset sale growth forecast from Nokia on Thursday.

Start your day with The Independent, sign up for daily news emails
ebooks
ebooksA celebration of British elections
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Guru Careers: Software Engineer / Software Developer

£40-50K: Guru Careers: We are seeking an experienced Software Engineer / Softw...

Ashdown Group: Trainee Consultant - Surrey/ South West London

£22000 per annum + pension,bonus,career progression: Ashdown Group: An establi...

Ashdown Group: Trainee Consultant - Surrey / South West London

£22000 per annum + pension,bonus,career progression: Ashdown Group: An establi...

Recruitment Genius: Claims Administrator

£16000 - £18500 per annum: Recruitment Genius: This is an excellent opportunit...

Day In a Page

Fishing for votes with Nigel Farage: The Ukip leader shows how he can work an audience as he casts his line to the disaffected of Grimsby

Fishing is on Nigel Farage's mind

Ukip leader casts a line to the disaffected
Who is bombing whom in the Middle East? It's amazing they don't all hit each other

Who is bombing whom in the Middle East?

Robert Fisk untangles the countries and factions
China's influence on fashion: At the top of the game both creatively and commercially

China's influence on fashion

At the top of the game both creatively and commercially
Lord O’Donnell: Former cabinet secretary on the election and life away from the levers of power

The man known as GOD has a reputation for getting the job done

Lord O'Donnell's three principles of rule
Rainbow shades: It's all bright on the night

Rainbow shades

It's all bright on the night
'It was first time I had ever tasted chocolate. I kept a piece, and when Amsterdam was liberated, I gave it to the first Allied soldier I saw'

Bread from heaven

Dutch survivors thank RAF for World War II drop that saved millions
Britain will be 'run for the wealthy and powerful' if Tories retain power - Labour

How 'the Axe' helped Labour

UK will be 'run for the wealthy and powerful' if Tories retain power
Rare and exclusive video shows the horrific price paid by activists for challenging the rule of jihadist extremists in Syria

The price to be paid for challenging the rule of extremists

A revolution now 'consuming its own children'
Welcome to the world of Megagames

Welcome to the world of Megagames

300 players take part in Watch the Skies! board game in London
'Nymphomaniac' actress reveals what it was really like to star in one of the most explicit films ever

Charlotte Gainsbourg on 'Nymphomaniac'

Starring in one of the most explicit films ever
Robert Fisk in Abu Dhabi: The Emirates' out-of-sight migrant workers helping to build the dream projects of its rulers

Robert Fisk in Abu Dhabi

The Emirates' out-of-sight migrant workers helping to build the dream projects of its rulers
Vince Cable interview: Charging fees for employment tribunals was 'a very bad move'

Vince Cable exclusive interview

Charging fees for employment tribunals was 'a very bad move'
Iwan Rheon interview: Game of Thrones star returns to his Welsh roots to record debut album

Iwan Rheon is returning to his Welsh roots

Rheon is best known for his role as the Bastard of Bolton. It's gruelling playing a sadistic torturer, he tells Craig McLean, but it hasn't stopped him recording an album of Welsh psychedelia
Morne Hardenberg interview: Cameraman for BBC's upcoming show Shark on filming the ocean's most dangerous predator

It's time for my close-up

Meet the man who films great whites for a living
Increasing numbers of homeless people in America keep their mobile phones on the streets

Homeless people keep mobile phones

A homeless person with a smartphone is a common sight in the US. And that's creating a network where the 'hobo' community can share information - and fight stigma - like never before