According to the provisional results announced by Samsung Electronics on the 8th, sales in the fourth quarter of last year were 61 trillion won and operating profit was 9 trillion won. Compared to the same period last year, sales increased 1.87% and operating profit increased 25.7%.
When the tentative results were announced, the results of each business division were not disclosed, but analysis shows that the main division, semiconductors, led the performance, while the mobile and home appliance divisions recorded operating profits similar to those of last year.
Jaeyong Lee Vice Chairman of Samsung Electronics [사진=삼성전자 제공]
The industry estimates that the semiconductor division’s operating profit increased by 25% compared to the same period of the previous year, ranging from KRW 4.1 trillion to KRW 4.5 trillion. In the fourth quarter of last year, as demand for laptop computers increased at the end of the year, DRAM and NAND shipments increased.
However, as memory semiconductor prices such as DRAM fell in 4Q, operating profit decreased compared to 3Q. According to market research firm DRAM Exchange, the fixed transaction price for PC DRAM (DDR4 8Gb) as of October last year was $2.85, down 8.9% from the fixed transaction price in September.
Ahead of the US government’s sanctions on Huawei in China in the third quarter of last year, demand seems to have decreased somewhat in the fourth quarter as customers accumulate inventory through bulk purchases.
The plunge in the won-dollar exchange rate also affected the decline in operating profit compared to the third quarter. Compared to the set (finished products) sector such as home appliances and mobile phones, which are mainly produced at overseas factories, semiconductors, which are produced in Korea, are sensitive to fluctuations in exchange rates. The won-dollar exchange rate fell to the 1,120 won level in October last year and then to the 1,109 won level in November.
The IM division’s operating profit is estimated to be around 2.5 trillion won, similar to the same period last year. In the third quarter, the launch of a new Galaxy series resulted in an operating profit of 4 trillion won, but revenue declined with the release of Apple’s iPhone 12 in the fourth quarter.
The CE division is also expected to record an operating profit of 800 billion won, the same level last year. Although demand increased due to Corona 19, profitability declined compared to the third quarter due to the expansion of year-end discount promotions such as Black Friday in the United States. However, considering the decline in sales volume due to European lockdown and the rise in panel prices, it is considered to be good.
In the market, Samsung Electronics is expected to continue its performance in the first quarter of this year at the same level as in the fourth quarter of last year. In the first quarter of this year, sales are expected to reach 53.8 trillion won and operating profit is estimated at 8 trillion won.
In the semiconductor division, earnings are expected to increase compared to the fourth quarter of last year on the rise of fixed DRAM prices. On the other hand, the home appliance division is expected to see a decline in earnings as it enters a seasonal off-demand season.
Park Yoo-ak, a researcher at Kiwoom Securities, said, “In the first quarter of this year, the quarterly earnings are expected to pass through the bottom.”
[사진=삼성전자]