Samsung’s fourth-quarter net profit of $4.4 billion is down 38% from a year earlier

January 30 (Xinhua) — Samsung Electronics Co. on Thursday reported its fourth-quarter and full-year results for the year ended December 31, 2019, according tomedia reports. Samsung’s fourth-quarter revenue was 59.88 trillion won ($50.8 billion), up 1 percent from a year earlier, while operating profit was 7.16 trillion won ($6.1 billion), down 34 percent from a year earlier, and net profit fell 38 percent to 5.2 trillion won ($4.4 billion), the company said.

Samsung's fourth-quarter net profit of $4.4 billion is down 38% from a year earlier

For the whole of 2019, Samsung’s revenue was 230.4 trillion won ($195.6 billion), down 5.5 percent from a year earlier, operating profit was 27.77 trillion won ($23.56 billion), down 52.8 percent from a year earlier, and net profit was 21.73 trillion won ($18.5 billion), down 51 percent from a year earlier.

Profits fell year-on-year in the fourth quarter as storage chip prices continued to fall and demand for display panels weakened. However, improved memory demand for servers and mobile products, as well as robust sales of flagship smartphones, helped mitigate the overall decline in earnings.

Looking ahead to 2020, Samsung expects an improvement in overall business performance, but also believes that there is still uncertainty about the global business environment. The memory market conditions are likely to gradually improve due to increased demand from data center companies and the adoption of 5G smartphones. However, it remains to be seen how quickly 5G is expanding and its impact on DRAM.

The contract business plans to expand production of the 5 nm and 7 nm EUV (Extreme UV lithography) processes, while also working on the development of the next generation of 3 nm GAA (gate all-round) technology. In terms of displays, Samsung will prioritize the increasing adoption of OLEds and folding screens.

The mobile business aims to boost profits by expanding sales of high-end models, such as enhanced 5G lineups and new collapsible devices. The network business will focus on addressing global 5G demand, as its South Korean business shrinks after the country adopted 5G last year.

In the consumer electronics division, the company will seek to increase sales of QLED 8K TVs and launch new high-end appliances such as customization and new lifestyle models.

Samsung’s total capital spending in 2019 is 26.9 trillion won ($22.8 billion), of which 22.6 trillion won ($19.2 billion) was spent on semiconductors. In 2020, Samsung will have the flexibility to implement capital expenditure plans to meet changing market needs while continuing to invest in infrastructure and medium- and long-term business opportunities.