Samsung Electronics achieves W200 tril. in sales in 2014Madeinkoreablog
Samsung Electronics posted a 6.1 trillion won ($5.93 billion) operating profit in the fourth quarter, up 15.3 percent from a year earlier but down 17.5 percent from a quarter earlier.
It is smaller than the market consensus of 6.5 trillion won, according to analysts.
They said the weaker-than-expected results reflect a slowdown in demand for semiconductors, displays and top-tier smartphones.
In its preliminary results released Friday, the company said sales rose 0.51 percent from a year earlier to 53 trillion won in the three months to December. It marks a 2.55 percent gain from a quarter earlier.
“Weakness came from components,” global market analyst Mark Newman at Bernstein said. “Weak LCD pricing hurt display earnings and lower memory profits more than offset the quarter-on-quarter increase in large-scale integration (LSI) profits. We believe LSI also came up short versus expectations due to weak Apple orders in December.”
Its full-year sales came in at 200.3 trillion won, reaching 200 trillion won for the fourth consecutive year.
The consumer electronics sector contributed positively to the company’s performance in the quarter, boosted largely by the increase in television and home appliance sales in the year-end season. But the mobile business was expected to fail to achieve a meaningful rebound.
Samsung is seeking to recover its mobile business performance after launching a new Galaxy smartphone.
Compared with the third quarter last year, when Samsung Electronics reaped about 800 billion won in foreign exchange gains, the won-dollar rate in the fourth quarter had limited impact on its results.
The market projection for the company this year still remains in question as demand for semiconductors does not appear likely to recover soon.
Intensifying competition in the mid and low-priced smartphone sector, caused by Chinese competitors, is also expected to affect the world’s largest smartphone maker.
Meanwhile, Samsung Electronics said the tentative results announcement is based on an estimation following International Financial Reporting Standards. The company has provided such information since July 2009 to help investors make more accurate projections on performance and corporate value.
Samsung Electronics did not provide detailed breakdowns of its quarterly results in the preliminary announcement and will release them in the regulatory filing scheduled later this month.