Samsung's nose put out of joint by down-and-out chip market

Profits in South Korean computer chip-maker Samsung have nose-dived 75 per cent, adding more woe to the downtrodden worldwide chip market.

Samsung reported a profit of $323m for its third quarter, down from $1.3bn the previous year. Samsung, which has a diversified electronics business, would have fared much worse if it were solely a chip company - its chip division lost $291m.

Like other chip-makers, the company has been hit hard by the fall in demand for Dynamic Random Access Memory (DRAM) chips, used to provide memory in most PCs.

Samsung posted revenues of $5.6bn, down by almost a fifth from the equivalent period last year.

However, the news was not unexpected, and shares in Samsung initially rose on the news.

Analysts say the semiconductor industry is experiencing its severest downturn for 20 years, with worldwide sales in 2001 expected to drop over 30 per cent on the previous year.