SEOUL: Samsung Electronics Co Ltd said on Thursday it expects fourth-quarter profit to fall due to weak server chip demand and rising smartphone competition, after posting its best quarterly operating profit in two years in the third quarter.
Samsung said mobile chip demand would rise in the fourth quarter, as Chinese customers boost orders following U.S. restrictions on Huawei Technologies Co Ltd , but server chip demand would remain weak due to large customer inventories. Samsung has applied for its U.S. license to export chips to Huawei and still waiting for the result, Han said.Operating profit in the July-September period jumped 59per cent to 12.35 trillion won on the back of Samsung's highest quarterly smartphone profit since 2014 at 4.45 trillion won .In the third quarter, a near 50per cent surge in smartphone sales likely reflected gains in Samsung's share of the market as rival Huawei lost market share due to the U.S.
"With Huawei's presence becoming fainter in the smartphone market, Samsung's marketing costs are expected to be higher in the current quarter as Apple, Vivo, Xiaomi and Samsung try to take over Huawei's market share," said Park Sung-soon, an analyst at Cape Investment & Securities.
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