Many sources are reporting a drop in demand for smartphones, TVs and other consumer electronics as people choose to spend on more important things in an inflationary environment. Korean giant Samsung Electronics is trying to gauge the extent of demand, but purchases of new components will either be suspended until the end of July or significantly reduced.
According to information Nikkei Asian Reviewthe company has informed its suppliers about the need to reduce the purchase volume of components by the end of July in order to check the existing stocks. Such measures will affect the segment of televisions, smartphones and consumer electronics devices. In some areas, purchases will be halved until Samsung Electronics determines further component needs.
At the end of the first quarter, Samsung Electronics had inventories of $36.9 billion, up 15% from the fourth quarter last year. The share of inventories in the overall structure of the company’s assets exceeded 10%. Last month, Samsung expected to sell 270 million smartphones by the end of the year, but now it’s likely to follow the example of Chinese rivals, who have reduced order volumes by 20% due to lockdowns in China and lower demand for products in Europe.