Samsung reports 3% drop in Q1 net profit

Monitoring Desk

SEOUL: The world’s biggest smartphone maker, Samsung Electronics, reported a three-percent drop in first-quarter net profits on Wednesday, as the coronavirus pandemic dampened consumer demand.

Net profits in the January-to-March period were 4.88 trillion won, down 3.1 percent from a year earlier, the company said in a statement.

The first-quarter performance was “partially due to effects of COVID-19”, Samsung said in a statement.

The firm is the flagship subsidiary of the giant Samsung Group, by far the largest of the family-controlled conglomerates known as “chaebols” that dominate business in the world’s 12th-largest economy.

The figures come as the coronavirus pandemic wreaks havoc across the world economy — earlier this month Samsung had operations suspended at 11 overseas assembly lines — with expectations rife of a looming global recession.

Samsung said “uncertainties driven by COVID-19 will persist” in the latter half of 2020 as the duration and impact of the pandemic remain “unknown”.

“Sales and profits of set products business, including smartphones and TVs, are expected to decline significantly as COVID-19 affects demand and leads to store and plant closures globally,” it said.

Operating profit rose 3.5 percent year-on-year to 6.5 trillion won, while sales in the first quarter stood at 55.3 trillion won. (AFP/APP)