Samsung recently reported its highest quarterly profits in three years. The company on Thursday declared that it suspects component shortages. And this can affect the chip demand from some customers in this quarter. All the industries from television to cars are facing the issue of shortage of logic chip parts. The companies are also facing manpower shortages, logistics snarls, and suspensions at parts plants because of power cuts in China.
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Samsung assumes component shortages to affect the chip demand
Samsung pressed on the fact that a longer-than-expected component supply issue may demand to be watched due to potential impacts. Although it added there was “strong fundamental demand for servers from increased investments from technology companies.”
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On the manufacturing of devices that use memory chips, Samsung also gave a statement. He said the world’s top maker of memory chips and smartphones posted a 28 per cent jump in operating profit in the July-September quarter to KRW 15.8 trillion (roughly Rs. 1,01,090 crore) on the back of an 82 per cent on-year profit surge in its chip business, where earnings rose to KRW 10.1 trillion (roughly Rs. 64,620 crores).
Samsung did not mention the scope for memory chip prices that have been estimated on the company’s shares as investors demand prices to have topped in the third quarter before dropping until mid-2022. However, Samsung claimed that the demand for server DRAM chips, which temporarily save data, and NAND flash chips will be strong in the fourth quarter. It will be because of the expansion of data centre investments.
Despite uncertainties over component supply, year-end holiday shopping is expected to boost demand for mobile devices in the fourth quarter. Moreover, Samsung aims to maintain a double-digit profit margin in the mobile business by selling more foldable phones.
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