Yahoo Finance Chip Stocks Slip on Samsung Profit Warning
Investing.com – Samsung Electronics’ profit warning painted a gloomy outlook for the semiconductor sector, sending shares of chipmakers tumbling.
Samsung said its profits in the second quarter of year likely fell by more than 56%, and revenue was expected to be down over 4% from the second quarter of 2018.
Samsung Electronics Co Ltd (KS:005930) fell 0.76%, NVIDIA (NASDAQ:NVDA) was down 1.6%, and Micron Technology (NASDAQ:MU) fell 0.5%. The Philadelphia Semiconductor Index was off 0.6%.
Samsung blamed the dour outlook on the ongoing U.S.-China trade war, which has exacerbated the weak backdrop for memory demand.
But many expect the weakness in memory demand will likely not be as bad as feared as Washington and Beijing have since called a truce on their months-long trade war, with President Trump also vowing to consider lifting restrictions on sales of components to Chinese telecommunications giant Huawei.
The update from Samsung dented some recent optimism in the sector following Micron’s better-than-expected results and rosier outlook on memory demand.
“We have seen early signs of bit-demand recovery in most (dynamic random access memory) end markets,” Sanjay Mehrotra, Micron’s president and chief executive, told analysts on a conference call following the earning results on June 25. “Based on our assessment of customer inventory improvement, we anticipate robust bit-demand growth for the industry in the second half of the calendar year compared to the weak demand in the first half.”
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