Feeds

Samsung sales, income slump

Won too strong, apparently

  • alert
  • submit to reddit

Build a business case: developing custom apps

Samsung's profits were well short of expectations in the first quarter, as it suffered in its three key markets: displays, chips and phones.

Sales for the quarter fell 4.2 per cent year on year to KRW13.8tr ($13.54bn), down just 2.6 per cent on the previous quarter. Operating profits were down 46 per cent to KRW2.15tr ($2.11bn), with net income coming to KRW1.5tr ($1.47bn), down 52 per cent on the year-ago quarter and 18 per cent sequentially.

Analysts polled by Bloomberg had anticipated, on average, net income of KRW2.4tr ($2.36bn) on sales of KRW14.25tr ($13.99bn). But Reuters notes that some had reined in their expectations during the week, and had forecast KRW1.56tr ($1.53bn), still above the figure Samsung delivered.

"This is not good news," Thomas Choi, head of research at PCA Asset Management, told the news agency.

Samsung blamed the decline on the strength of the won against the dollar. Exchange rates have gone up almost 20 per cent since the start of the year, which is a problem when 80 per cent or more of your sales are made overseas.

The company, the world's third largest mobile phone maker, sold 24.5m units, a record, in the quarter, up from 21.1m in the previous quarter. Margins were up, too, to 17 per cent. But it wasn't sufficient to counter falling prices which knocked the division's operating income down 33 per cent year on year to KRW841bn ($825.4m).

Chip operating income fell 22 per cent to KRW1.39tr ($1.36bn), again thanks to the tough exchange rate and to worldwide inventory issues, while the LCD division saw operating profits fall 97 per cent to KRW205bn ($201.2m) as prices slumped.

And don't expect any improvement in the current quarter, the company warned. Trading conditions aren't going to get any better, it said, pinning its hopes on digital TV receivers and even larger LCD products. ®

Related stories

Chip maker Centaur out-paces Intel, Samsung
Samsung unveils 3GB HDD smart phone
Samsung shows 82in monster TV
Samsung glum on year ahead
Samsung shows 'world's first' DDR 3 chip
Smart phone shipments break records
Mobile phones shipments up 38% in Q4

Build a business case: developing custom apps

More from The Register

next story
iPad? More like iFAD: We reveal why Apple fell into IBM's arms
But never fear fanbois, you're still lapping up iPhones, Macs
Amazon says Hachette should lower ebook prices, pay authors more
Oh yeah ... and a 30% cut for Amazon to seal the deal
Philip K Dick 'Nazi alternate reality' story to be made into TV series
Amazon Studios, Ridley Scott firm to produce The Man in the High Castle
Nintend-OH NO! Sorry, Mario – your profits are in another castle
Red-hatted mascot, red-colored logo, red-stained finance books
Sonos AXES support for Apple's iOS4 and 5
Want to use your iThing? You can't - it's too old
Joe Average isn't worth $10 a year to Mark Zuckerberg
The Social Network deflates the PC resurgence with mobile-only usage prediction
Chips are down at Broadcom: Thousands of workers laid off
Cellphone baseband device biz shuttered
Feel free to BONK on the TUBE, says Transport for London
Plus: Almost NOBODY uses pay-by-bonk on buses - Visa
Twitch rich as Google flicks $1bn hitch switch, claims snitch
Gameplay streaming biz and search king refuse to deny fresh gobble rumors
Stick a 4K in them: Super high-res TVs are DONE
4,000 pixels is niche now... Don't say we didn't warn you
prev story

Whitepapers

Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Boost IT visibility and business value
How building a great service catalog relieves pressure points and demonstrates the value of IT service management.
Why and how to choose the right cloud vendor
The benefits of cloud-based storage in your processes. Eliminate onsite, disk-based backup and archiving in favor of cloud-based data protection.
The Essential Guide to IT Transformation
ServiceNow discusses three IT transformations that can help CIO's automate IT services to transform IT and the enterprise.
Maximize storage efficiency across the enterprise
The HP StoreOnce backup solution offers highly flexible, centrally managed, and highly efficient data protection for any enterprise.