Samsung profit Archives - Gizmochina

Samsung Displays Resilience with Minimal Profit Dip in Q4 Amidst Semiconductor Challenges

Joane — Mon, 08 Jan 2024 19:00:32 +0000

Samsung Electronics revealed the smallest profit drop in six quarters. Analysts’ estimates point to a 14% decline in the fourth-quarter profit, reaching 3.7 trillion won. This figure reflects a year-on-year drop compared to the previous year’s Q4 profit of 4.31 trillion won, signaling a challenging period for the tech giant.

The chip division, a critical segment for Samsung, is expected to show signs of recovery, with a projected reduction in the quarterly loss to around 1.2 trillion won. The DRAM chips business, after consecutive quarterly losses in Q2 and Q3, returned to profitability. This positive shift is buoyed by indications of an industry-wide recovery, as DRAM and NAND flash chip prices experienced a rebound in Q4.

The encouraging trends in DRAM and NAND prices reveal a promising outlook for the semiconductor industry in 2024. Mobile DRAM chip prices witnessed an 18 to 23% increase, while mobile NAND flash chip prices rose by 10 to 15% in the last quarter. These price hikes underscore a positive trajectory for the sector, fueling optimism for a broader recovery in the upcoming year.

Samsung’s production strategy, characterized by a cut in production since H1 2023, seems to be adapting to the changing market dynamics. In Q4, there are indications of gearing up for increased DRAM chip production, including an uptake in silicon wafers. The company’s aggressive stance in selling memory chips in Q4, especially in comparison to competitors like SK Hynix, signals an effort to lower inventory levels and align with market demands.

Despite challenges in the mobile business, Samsung is expected to show an operating profit of around 2.5 trillion won. However, shipments of flagship foldable models are estimated to have fallen by about 1 million units each compared to Q3. The mobile segment’s performance, affected by declining sales volumes of flagship smartphones with flexible displays, underscores the challenges faced by Samsung in this competitive market.

Investors keenly await the preliminary results set to be announced this week, as Samsung’s profit decline is considered a significant indicator for the entire semiconductor market. Despite the negative dynamics, the slowdown in the profit decline is viewed as a positive signal for investors, offering a glimpse of potential stability in the semiconductor industry.

Analysts, however, remain cautious, predicting a 35% year-on-year decline in Samsung’s operating profit to $2.82 billion for the last quarter. The semiconductor business, a key revenue driver, is expected to limit its operating loss to about $912 million, a significant improvement compared to the higher losses in the second and third quarters of the previous year. The memory price trends and production strategies employed by Samsung in the last quarter reveal the efforts to balance market demands and profitability, underlining the intricate challenges faced by one of the industry giants.

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Samsung profits fall by 70% due to weak smartphone & chip sales

Sean — Fri, 06 Jan 2023 11:20:14 +0000

Samsung profits have tanked in the fourth quarter of last year by a noticeable figure following declining demand of its and slowing sales of its memory chips. There are various reasons for this issue, so here are all the details.

The South Korean tech giant recently share his financial report that showcased that the company saw a sizeable fall of near 70 percent in Q4 2022. This is a major fall in profits compared to the same period last year. There are many reasons for the fall in profits, with low demand for semiconductors and smartphones due to global economic issues. The brand reported that it had expected an operating profit of 4.3 trillion won and a revenue of around 70 trillion won for the fourth quarter of 2022.

However, it saw a revenue drop of approximately 9 percent year on year while its operating profits fell by 69 percent during this same time. Furthermore, the operating profits had also dropped by more than half from the third quarter, which is also when Samsung saw its first year on year profit decline in three years. This was also due to falling chip demand that led to weakening sales in the market.

Samsung added that it saw a significant drop in earnings from the memory business due to lackluster demand while also seeing weaker smartphone sales. It stated that this trend continues amid the uncertainties with the surrounding external factors that have caused a “potential global economic downturn.” The fall in sale also led to a decline in the average sales prices of the chips to lower than expected levels.

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Samsung’s Profit at Risk as Demand Dries Up

Oğuz Çakır — Thu, 22 Dec 2022 08:40:45 +0000

Samsung’s operating profit in the fourth quarter of 2022 could be in trouble, according to a new estimate by Goldman Sachs. The global investment and banking firm has lowered its operating profit estimate for Samsung Electronics to KRW 5.8 trillion ($4.5 billion) for the fourth quarter, a decrease of 25.6% from its previous estimate of KRW 7.8 trillion. If the estimate turns out to be accurate, it would represent a 58.3% drop in Samsung’s operating profit from the same quarter in 2021.

Goldman Sachs forecasts sharp drop in Samsung’s profit

The decrease in the estimate is largely due to a forecast of a slashed operating profit in Samsung’s semiconductor business unit. Goldman Sachs estimates that Samsung will reap KRW 1.5 trillion in operating profit from its chip-making business in the fourth quarter, a massive 83% drop from the company’s operating profit from the semiconductor unit in the fourth quarter of 2021. This would be the lowest operating profit for the semiconductor business since 2009.

Goldman Sachs’ earnings estimates for Samsung differ from those of local brokerage firms, which have projected more optimistic numbers. The global investment bank attributed the downward adjustment to weakened performances in the global memory chip sector and Samsung’s decreased shipments of smartphones and TV sets. It also expects Samsung to post a larger fall in operating profit next year due to the global market’s memory chip down cycle.

While some local analysts predict a turnaround for the memory chip market in 2024, the near-term outlook for Samsung is not looking good. The company will likely face a challenging fourth quarter in 2022 and a difficult year in 2023 due to decreased demand for semiconductor chips and other factors. It remains to be seen how Samsung will navigate these challenges and if it will be able to bounce back in the future.

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Samsung’s Q2 2022 sales are “strong”, however profits are still declining

Divyansh Mehta — Fri, 29 Jul 2022 06:06:03 +0000

Samsung’s most recent financial results are nothing short of spectacular, with the manufacturer of semiconductors, smartphones, tablets, smartwatches, televisions, and home appliances proudly displaying a new all-time Q2 2022 revenue record to please investors and garner favorable media coverage.

However, even though the company’s operating profit is increasing year over year, from 12.57 trillion Korean won in Q2 2021 to KRW 14.1 trillion (10.8 billion US dollars) between April and June 2022, at least one important division is not doing well from the always important profitability standpoint.

This is the mobile (also known as MX and Networks) business, which managed to generate a more than respectable 29.34 trillion won in combined sales while reporting a very modest gain of about $2 billion during this year’s second calendar quarter.

Operating profit for Samsung’s market-leading smartphones was KRW 2.62 trillion, down from 3.24 and 3.82 trillion won in Q2 2021 and Q1 2022, respectively. Before you even consider it, you should be aware that the South Korean tech giant’s most recent financial report expressly calls out the Galaxy S22 and Galaxy Tab S8 families of ultra-high-end mobile devices as “strong” performers, suggesting that the division’s issues could be elsewhere.

The underwhelming and tardy Galaxy S21 FE and the less-than-value-packed newest members of the mid-range Galaxy A lineup are just a few of the obvious suspects, though Samsung is obviously not naming and shaming any low-performing products, instead blaming “some degree” of the declining profits of its mobile business on “rising costs of components and logistics as well as negative effects of foreign exchange movements.”

While the Galaxy Z Fold 4 and Z Flip 4 are anticipated to generate “solid profitability” in the second half of 2022, “prolonged geopolitical issues and economic uncertainties” could lead revenues to remain “similar year-over-year.” Yesterday, we reported the latest official trailer of the Galaxy Unpacked event was released where the new-gen Galaxy Foldable devices were teased.