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Samsung predicts drop in profit

FILE - In this Oct. 31, 2019, file photo, the logo of the Samsung Electronics Co. is seen at its office in Seoul, South Korea. Samsung Electronics Co. said Wednesday, Jan. 8, 2020, its operating profit for the last quarter likely fell 34% from a year earlier, which would be a smaller-than-expected decline possibly resulting from increased smartphone shipments and gradually stabilizing computer chip prices. (AP Photo/Ahn Young-joon, File)

SEOUL, South Korea (AP) — Samsung Electronics Co. said Wednesday its operating profit for the last quarter likely fell 34% from a year earlier, which would be a smaller-than-expected decline possibly resulting from increased smartphone shipments and gradually stabilizing computer chip prices.

The South Korean tech giant estimated an operating profit of 7.1 trillion won ($6 billion) for the October-to-December quarter, which would represent a 34.26% drop from the same period last year.

Samsung said its revenue likely dropped 0.46% to 59 trillion won ($50 billion), but it did not break down its performance by business division. It will do when it releases a finalized earnings report later this month.

Samsung, the world’s biggest producer of smartphones and semiconductors, has suffered a sharp drop in profit over the past year with an industry-wide glut forcing chip-makers to slash prices to clear out inventory. The company estimated an operating profit of 27.7 trillion won ($23.5 billion) for the full-year 2019, which would represent 53% drop from a year earlier.

Analysts say there are signs that the global market for memory chips is beginning to stabilize due to increase demands in servers and mobile devices.

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