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Samsung Expects Sharp Downturn in Chip Sales to Extend Into Next Year
Company plans to continue to expand its investment and research-and-development spending
By Jiyoung Sohn
Sept. 7, 2022 4:00 am ET
PYEONGTAEK, South Korea— Samsung Electronics Co. sees the sharp downturn in chip sales extending into next year, the latest note of pessimism for a semiconductor industry reeling from a dramatic pullback in sales of PCs, smartphones and data servers.
“The second half of this year looks bad, and as of now, next year doesn’t really seem to show a clear momentum for much improvement,” said Kyung Kye-hyun, who heads Samsung’s semiconductors unit and serves as the company’s co-CEO, at a Wednesday media briefing.
Samsung, the world’s largest chip maker by revenue, will respond quickly to fast-changing market conditions, Mr. Kyung said. Earlier this year, industry executives widely believed that the second half of 2022 would be stronger than the first. But by late spring, it became apparent that demand levels had “drastically changed” and would instead be softening significantly, Mr. Kyung said.
Despite the slowdown, Mr. Kyung said Samsung would continue to expand its investment and research-and-development spending. He suggested Samsung could—as it did during prior industry dry spells—use the downturn to capture more market share. He didn’t elaborate.
“Bad times can become good opportunities,” said Mr. Kyung, 59 years old, who rose to Samsung’s co-CEO position late last year.
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Global chip sales are expected to grow 13.9% to $633 billion this year, according to a recent forecast from trade group World Semiconductor Trade Statistics. That represents a pullback from an earlier projection for a 16.3% rise.
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