As Memory-Chip Prices Decline, So Do Samsung's Earnings Hopes

SEOUL, South Korea -- Memory-chip prices are continuing to fall, as are the earnings hopes of the industry's largest producer, Samsung Electronics Co.

Prices of 16-megabit dynamic random access memory chips, called DRAMs, have dropped about 67% this year to about $14 a chip. The drop is far worse than the most bearish analysts predicted only weeks ago. Analysts say a relentlessly increasing supply is outpacing the demand for chips.