The daily business briefing: January 8, 2019

Samsung reports a sharp drop in profit, Chinese and American negotiators meet to discuss a trade deal, and more

 Samsung reports a sharp drop in profit.
(Image credit: Justin Sullivan/Getty Images)

1. Samsung blames disappointing profit on weak chip demand

Samsung Electronics said Tuesday its quarterly profit likely dropped sharply due to weak demand for its memory chips and growing competition from rival smartphone makers. The South Korean tech giant predicted its operating profit for the final quarter of 2018 would come in at $9.7 billion, nearly 29 percent less than a year earlier and 18 percent below analysts' expectations. The company said demand would remain soft in the first quarter of 2019 but probably improve in the second half of the year as new smartphones come out. "What's happening is that memory demand has really fallen off a cliff in (the fourth quarter)," Mark Newman, managing director at Sanford C. Bernstein, told CNBC on Tuesday.

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