Samsung Electronics’ second quarter profit falls 56% as chip market weakens

Samsung Electronics Co Ltd said it expected the chip market to bottom out and start to recover in the second half as it posted a 56% drop in quarterly profit on Wednesday, hit by declines in semiconductor prices amid oversupply.

The outlook from the global chip leader will give investors hope that the notoriously cyclical memory chip industry is shifting out of a downturn linked to slowing sales of gadgets such as smartphones.

“Server demand is expected to increase gradually as customers adjust their inventory levels and resume purchasing, while PC demand is also likely to expand,” the South Korean tech giant said, referring to demand for its DRAM chips.