JanuaryMarch operating profit down 95
Q2 recovery expected to be limited
Samsung spends biggest capex for any first quarter despite loss
Samsung to keep chip investment similar to 2022

SEOUL, April 27 Reuters Samsung Electronics Co Ltd flagged a gradual recovery for chips in the second half of the year after its semiconductor business reported a record 3.4 billion loss on Thursday, driven by a chip glut from weak demand for tech devices.

A global downturn in semiconductor purchases amid an economic slowdown and corporate belttightening sent chip prices plummeting in the first quarter, triggering production cuts across the sector.

By the second half of the year, customers will have run down inventory and will gradually start buying chips again, Samsung said.

We expect inventory levels to start dropping in the second quarter, said Jaejune Kim, executive vice president of Samsung39;s memory business.

For the current quarter, Samsung said it expected limited recovery for memory chips as major data centre firms invested more conservatively in servers.

The world39;s biggest memory chipmaker said operating profit fell to 640 billion won 478.6 million for the JanuaryMarch quarter, down 95 from a year earlier and its smallest profit for any quarter in 14 years.

The South Korean tech giant39;s chip division normally its most reliable cash cow reported a 4.58 trillion won 3.41 billion loss compared to a 8.45 trillion won profit a year earlier.

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