Samsung has announced that its 40% decline in operating profits in Q4 2018 is due to a weak market demand for memory chips. Samsung posted an operating profit of 10.8 trillion won which is 38.5% lower than the 15.1 trillion won it posted in the previous quarter. This is the lowest operating profit that Samsung has posted since Q1 2017. Samsung shares closed down 24% last year and fell another 1.68% Tuesday. Market analysts are optimistic that its foldable phone technology and new CPUs will help the company to recover its profitability in the second half. Analysts expect Samsung to reduce its chip production capacity to achieve a recovery in the second half. In a move to ease market confusion, the company issued a rare statement saying weak memory chip sales and escalating market uncertainties were to blame for its lower-than-expected earnings. In the first commentary the company had attached to any of its regulatory filings since late 2014, Samsung said profits would remain weak in the first quarter of this year, but could be expected to rebound in the second half on the anticipated recovery of the memory chip market. The company added a comment four years ago when its smartphone business hit bottom.