Samsung Electronics said its revenue may drop 4.2 percent to 56 trillion won in its second-quarter from a year earlier.

The dip in revenue is on account of poor demand in the global chip and smartphone markets due to the U.S.-China trade war.

Samsung is also forecasting a significant drop in its second-quarter operating profit. This means Samsung’s operating profit will decline for the third consecutive quarters indicating the pressure on its current business model and the global business conditions.

Chip prices fell due to a supply glut and U.S. sanctions on Chinese telecom equipment maker Huawei Technologies, a key Samsung client, Reuters reported.

Memory chipmakers like Samsung and South Korea’s SK Hynix are hurting as rising tariffs hit global demand for electronics. Seoul cut its annual economic growth target on Wednesday to a seven-year low as exports slump.

South Korea’s tech majors are also bearing the brunt of Japanese curbs on exports to South Korea of materials used in memory chips and smartphones, the latest flashpoint in a quarrel over Japan’s use of forced wartime labor.

April-June operating profit likely fell 56 percent to 6.5 trillion won ($5.6 billion), Samsung in a regulatory filing ahead of the release of its detailed earnings figures in late July.

One-off gains in the display division, which supplies display panels to iPhone maker Apple, were reflected in the operating profit, the company said.

Samsung has received reimbursement worth about 800 billion won for display panels sold to Apple as the U.S. smartphone maker missed a sales target the parties had agreed on, analysts said.