Samsung operating profit hit by R&D spending, fight to meet chip demand [Video]

The operating profit of South Korean tech giant Samsung Electronics sank almost a third in the fourth quarter owing to spending on research, the company said Friday, as analysts said it was struggling to meet demand for chips used in AI servers.

The news comes as industry leaders try to assess the outlook for the sector after Chinese startup DeepSeek unveiled a groundbreaking chatbot that performed as well as artificial intelligence pacesetters — apparently for a fraction of the cost.

The world’s largest memory-chip maker had already acknowledged in October that it was facing a “crisis”, and acknowledged questions had arisen about its “fundamental technological competitiveness and the future of the company”.

It said operating profit fell to 6.5 trillion won ($4.5 billion) in October-December, from 9.18 trillion won in the previous three months. However, it was up 130 percent on-year.

Sales rose 11.8 percent to 75.78 trillion won and …