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On average, 29 analysts expect that,SamsungOperating profit in the second quarter will reach 6 trillion won ($5.14 billion), down 60% from 14.9 trillion won in the same period last year. Samsung will release detailed results for the second quarter later this month, and its share price has risen by 5.3% in three months.
However, chip sales contributed more than two-thirds of Samsung's profits. The saturation of the smart phone market and the decline in demand for data centers have led to a decline in chip prices.
The price of DRAM chips is unlikely to rebound in the second half of this year, said Wu Yating, a technology analyst at Chip Research Corporation Jibang. Moreover, it is difficult for Samsung to clear its inventory by the first half of 2020. Chibon Technologies expects DRAM chip prices to drop by 25% in the three months to June. Last month, ChinaTech increased the price of DRAM chips in the third quarter from 10% to 15% to 20%.
In April, Samsung expects its smartphone and chip sales to recover in the second half of this year. American Chip ManufacturerMei GuangTechnology also says demand will recover later this year.
"The profit recovery of memory chip manufacturers will come, but not so fast and not so dramatically." Song Myung-sup, senior analyst at HI Investment and Securities.