Samsung Electronics has reported financial results for the fourth quarter ended December 31, 2019 and the fiscal year 2019.
The Company posted US$50.7 billion (Ksh. 5.1 trillion) in consolidated quarterly revenue and US$ 6 billion (Ksh. 603.6 billion) in quarterly operating profit.
“Fourth quarter profit dropped from a year earlier due to the continued fall in memory chip prices and weakness in display panels. Improving demand for memory used in servers and mobile products, as well as solid sales of flagship smartphones, helped ease the decline in overall earnings,” Samsung said while unveiling the results.
The Memory Business reported a year-on-year decline in profit as DRAM prices continued its downward trend despite rising shipments. However, earnings increased from the previous quarter, underpinned by increasing demand from data centers and other major applications as well as cost reduction. The logic chip business posted a YoY (Year over Year) profit growth on demand for high-resolution image sensors and HPC (High Performance Computing) chips.
Samsung’s Display Panel Business suffered weak demand for some premium mobile screens and saw widened losses from the large panel business.
Quarterly earnings improved significantly for the Mobile Business in annual terms, thanks to solid sales of flagship Galaxy smartphones and lineup changes to improve profitability for mass-market models. Profit fell from the previous quarter, however, due to the fading effect from a new flagship product launch.
The Consumer Electronics Business also reported a YoY increase in earnings, led by growing sales of premium products including QLED TVs and new appliance offerings.
In the first quarter of 2020, the Company expects weak sales from seasonality in memory chips, OLED and consumer electronics.
First quarter profit from the Mobile Business is seen steady quarter-on-quarter, as new flagship and foldable models will improve sales but incur additional marketing costs.
Looking ahead to 2020, Samsung expects improvements in overall business performance but also sees continued uncertainties in the global business environment.