Samsung expecting sharp profit drop as tough 2019 looms ahead
South Korean technology giant Samsung is expecting profits for the most recent quarter to drop sharply, in a warning of falling demand that comes less than a week after Apple gave a similarly gloomy outlook.
In an estimate covering the three months up to December, Samsung suggested its operating profit would come in at 10.8 trillion won (9.67 billion U.S. dollars), a 29 percent year-on-year drop and 38.5 percent down from the previous quarter.
Recent years have seen Samsung post strong growth, riding mainly on impressive sales of semiconductors and chip technology.
However, the company's latest estimates suggest that semiconductor shipments and chip prices dropped at the end of 2018, following what Samsung described as "lackluster demand."
The company also identified "intensifying competition" in the smartphone sector as a factor in the expected profit drop.
Samsung has been the world's biggest smartphone manufacturer in terms of sales since 2012, but Chinese companies like Huawei and Xiaomi have cut into its market share in recent years.
According to data compiled by The Guardian, Samsung was still the global market leader after the second quarter of 2018, but its sales dropped 10 percent year-on-year to 71.9 million handsets.
Huawei, meanwhile, saw its sales skyrocket by 41 percent over the same period, shipping 54.2 million handsets to overtake Apple as the world's second-largest smartphone maker.
Samsung will publish its 2018 Q4 data later this month, and many analysts expect a tough 2019 ahead for the company and the wider tech sector.
Huawei has continued to see impressive growth despite U.S.-China trade tensions through 2018, shipping a record 200 million smartphones and securing 25 commercial contracts for its 5G technology, according to comments from its chairman Liang Hua last month.