Samsung issues profit warning as chip sales slide

Samsung recently announced it would be launching a folding phone

Samsung has issued a surprise profit warning, blaming low memory chip prices.

The South Korean company said it expected to miss market estimates for the first quarter of this year amid falling prices for LCD screens and semi-conductors.

“The company expects the scope of price declines in main memory chip products to be larger than expected,” it said in a regulatory filing.

The computer memory market has been slowing due to reduced demand from large customers such as Amazon and Google parent company Alphabet, and a shortage of Intel processors has also limited personal computer shipments.

Samsung, the world's largest smartphone manufacturer, also supplies display screens to Apple, and has also been hit by fewer user upgrades and lower-than-expected demand for iPhones.

The statement came ahead of its full preliminary results, which are due to be released early next month.

The company’s shares fell slightly on the announcement, which follows a 29pc drop in earnings for the final quarter of last year, announced in January.

Smartphone makers, including Samsung, are now faced with a decline in smartphone sales as consumers are buying phones less often and are no longer loyal to the largest companies, opting for reduced price handsets from lesser known companies.