Samsung Mobile Profits Slow, TVs Resurge
Samsung Q4 results out today showed the net profit slipped to 7.3 trillion KRW – a drop of 8.24 tr won compared to Q3, although rose compared to same time a year ago.
The quarterly decline, for first time in two years, was blamed on fluctuations in the local currency and a massive 800bn won payout to staff.
Samsung’s hugely profitable mobile division fell, although demand for consumer electronics (CE), including TV’s, enjoyed a major surge.
In spite of this, Samsung sales rose slightly in the holiday quarter to 59.28 trillion won, compared to Q3 and up 5.7% compared to 12 months prior, although operating profit slipped 18%.
Sales in consumer electronics rose 18% q-o-q but Samsung mobile units slumped 7% compared to Q3, but was up 31% year on year.
Demand increased for Galaxy smartphones led by a holiday rally but Q4 shipments fell due to inventory adjustments, and “the base effect from a strong q3.”
Tablet shipments rose sharply with strong demand for Galaxy Note 10.1 and Tab 3, both launched during the Oct-Dec quarter.
However, these gains are offset by higher marketing costs.
Samsung Display Panel business, one of the worlds biggest, fell 20% in the final quarter.
Samsung consumer electronics (CE) division saw an 88% rise in operating profits, with TV demand rising.
Demand for 60″ TVs and greater rose “substantially” (+80%) led by the developed markets, good news for the worlds biggest TV panel maker which has invested heavily in OLED and 4K technologies.
Overall TV shipments grew a massive 90% and Smart TV demand rose 63%.
“Interesting that in ’14 outlook Samsung says to expect even more product segments in both phones & tabs – not many can afford this strategy,” analyst Carolina Milanesi, @caro_milanesi, tweeted.
The Korean giant expects the World Cup will lift TV sales this year, and expects expansion of 4G LTE networks globally to fuel smartphone demand, but predicts competition for both tablets and mobiles to intensify.