Samsung Cuts Q4 Mid to Low End Phone Output on Glass Shortage

Tech5 days ago

The price of memory chips and PCB materials has climbed to a level that threatens the profitability of budget devices for Samsung Electronics. The company is reducing its production of mid to low end smartphones for the fourth quarter because of a supply shortage of E-glass from Nittobo, a critical component used in copper clad laminate for printed circuit boards.

Rising costs for glass fabric and other components have compressed margins for the hardware maker, making previous high volume production plans unfeasible. This combination of supply bottlenecks for raw materials and surging costs for memory chips has forced the vendor to scale back output to protect against losses.

Mapped to your portfolio

Possible scenarios

45%Temporary Shortage Managed-0.2%
25%Broader Handset Squeeze-1.2%
20%Demand Weakness Exposed-0.9%

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Samsung Cuts Q4 Mid to Low End Phone Output on Glass Shortage

In this story

Samsung Electronics Nitto Boseki

Portfolio

SPY
State Street SPDR S&P 500 ETF Trust
100%

Portfolio

SPY
State Street SPDR S&P 500 ETF Trust
100%

Mapped to your portfolio

Possible scenarios

45%Temporary Shortage Managed-0.2%
25%Broader Handset Squeeze-1.2%
20%Demand Weakness Exposed-0.9%

Each figure is the modeled move of the S&P 500 if the outcome occurs. For information only. Not investment advice.