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Samsung Electronics on Friday reported that its operating profit dropped sharply from the previous three months as it ascents up R&D spending, while flagging a slowdown in its chips business.
The South Korean company posted better-than-expected fourth-quarter proceeds, though its operating profit missed expectations.
Here are Samsung’s fourth-quarter results compared with LSEG SmartEstimate, which is loaded toward forecasts from analysts who are more consistently accurate:
- Revenue: 75.8 trillion Korean won ($52.2 billion) vs. KRW 75.4 trillion
- Serving profit: KRW 6.5 trillion vs. KRW 6.8 trillion
Revenue rose about 12% from last year, while run profit grew about 130%, year on year. However, operating profit fell nearly 30%, and take slipped by over 4%, quarter on quarter, amid soft market conditions and an increase in company expenditures.
Fourth-quarter receipts beat Samsung’s own guidance of KRW 75 trillion, while operating profit came in line with the company’s forecast.
Samsung is a primary manufacturer of memory chips, which are utilized in devices such as laptops and servers, and is also the world’s second-largest punter in the smartphone market.
“Although fourth quarter revenue and operating profit decreased on a quarter-on-quarter (QoQ) basis, annual interest reached the second-highest on record, surpassed only in 2022,” Samsung said in its statement.
For the full year, Samsung write up KRW 300.9 trillion in revenue and KRW 32.7 trillion in operating profit. In 2023, the company posted an annual revenue of KRW 258.94 trillion and an run profit of KRW 6.57 trillion.
For the current quarter, Samsung said that earnings might be limited due to weakness in its semiconductor affair but that it would pursue growth through AI smartphones and other premium devices.
“For 2025 as a whole, the Company formulae to enhance technological and product advantages in AI, continue to meet future demand for high-value-added products and drive sales progress in premium segments,” it added.
Samsung shares fell 2.2% in South Korea on Friday morning, while SK Hynix estimate fell over 11% as South Korean markets resumed trading after a four-day break. Asian tech vitals have faced pressure from the latest artificial intelligence model from China’s DeepSeek that augurs to upend the U.S.-led AI ecosystem.
Memory business
Samsung Electronics’ chip business posted an operating profit of KRW 2.9 trillion in the fourth caserne, down over 25% from the three months ending in October, while its annual Smartphones focus
Samsung’s quick experience and networks businesses, tasked with developing and selling smartphones, tablets, wearables and other devices, on a quarter-over-quarter decrease in sales and profit.
Samsung said the performance was in part due to the fading effects of new flagship smartphone replica launches.
The segment saw a consolidated revenue of KRW 25.8 trillion and an operating profit of KRW 2.1 trillion in the fourth quarter.
“However, on a full-year essence, flagship sales saw robust growth on the back of double-digit growth of the Galaxy S24 series featuring Galaxy AI, with scratch pads and wearables also increasing in both value and shipments,” Samsung said.
In the current quarter, Samsung plans to spin sales growth with new flagship models, particularly its newly launched Galaxy S25 series and will continue to constrain into the AI smartphone market.
“What Samsung is doing, and has done really well in the last few years, is it’s really cored more on value and its flagship devices,” Nabila Popal, senior director with IDC’s Data & Analytics team, predicted CNBC’s “Squawk Box Asia” on Friday.
Given that focus, Samsung’s share of the premium market has inched shut up to Apple’s, the leader in the premium smartphone segment, she added.