Korean electronics conglomerate Samsung has pinned the blame for a shock profit warning on a slide in the market value for memory chips, compounding ongoing declines in the value of LCD screens and semi-conductors.
The reversal in fortune comes amid a global slowdown in demand driven by Amazon and Google scaling back orders for computer memory as well as lower than anticipated screen demand for Apple’s iPhone, as existing owners opt to hold onto their devices for longer.
Outlining its predicament Samsung wrote in a regulatory filing: "The company expects the scope of price declines in main memory chip products to be larger than expected."
Samsung has itself been hit hard by a perfect storm of declining smartphone sales as markets reach a saturation point, a lack of innovation eroding the annual upgrade cycle and the arrival of upstart smartphone makers such as Xiaomi offering high-end devices at lower cost.
Samsung will release its full preliminary results early next month.
Last month Samsung axed its controversial partnership with Supreme Italia, a counterfeit business posing as the popular streetwear brand