The world's largest memory chip maker Samsung has announced that profits dropped in the first quarter.
Pre-tax profits for the firm were 1.84 trillion won (£9.7 billion) in the first three months of the year, a drop of 32 per cent from the last quarter results in 2006.
Sales for the South Korean-based company during the first three months of this year also fell by eight per cent on the last quarter to 14.39 trillion won (£7.7 billion).
Facing tough competition, the firm predicted a further five to ten per cent drop in DRAM (dynamic random access memory) prices in the second quarter but at the same time forecast a drive in demand for main PC memory components and an increase in sales of consumer electricals.
The company also expects to see a recovery in the demand for large television monitor panels in the second quarter.
Speaking to analysts on a conference call, Samsung's vice president for investor relations Robert Yi said: "[Memory chip] prices fell too sharply over the first quarter to be offset by our cost reduction efforts.
"Of course this is a problem faced by all DRAM and [flash memory] producers, not just Samsung Electronics," he added.
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