Samsung profits down 28.7% YoY in Q4 2018 on weak chip and phone sales


Samsung has reported its earnings for Q4 2018, in which the company has made operating profit of 10.80 trillion won ($9.7 billion), down 28.7% YoY, as expected, for the October to December 2018 period. This due to drop in demand for memory chips used in data centers and smartphones. “The System LSI and Foundry businesses also saw profits decline due to weak seasonality,” added Samsung. It reported revenue of 59.27 trillion won, down 10% YoY from 65.98 trillion won last year.

For 2018, Samsung reported 243.77 trillion won in revenue, up 2% and 58.89 trillion won in operating profit, up 9.76%, making it a record for the second straight year, even as unfavorable business and macroeconomic factors led to slower performance in the final quarter.

IM sector that includes Mobile Communications and Networks Businesses posted 23.32 trillion won consolidated revenue, down 8.44% YoY and 1.51 trillion won operating profit for the quarter, down 37.6% compared to 2.42 trillion won in the same quarter last year. For 2018, the IM sector posted 10.17 won operating profit, down 14% compared to 2017.

In Q4, operating profit decreased QoQ due to a decline in both smartphone sales volume and revenue amid a sluggish smartphone market overall despite strong seasonal demand. Samsung expects demand for smartphones and tablet PCs to decline in Q1 2019 due to the seasonal slowdown in the market. Samsung expects to prop up sales and business performance in the coming months with the Galaxy S10 launch next month.

This year, Samsung plans to launch foldable and 5G devices, and expand into new markets. It will also expand Bixby to various devices and connected services while improving its AI capabilities. It aims to bring new innovation to OLED screens for smartphones and develop new applications.

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Author: Srivatsan Sridhar

Srivatsan Sridhar is a Mobile Technology Enthusiast who is passionate about Mobile phones and Mobile apps. He uses the phones he reviews as his main phone. You can follow him on Twitter and Instagram