Samsung had a difficult task to accomplish during its quarterly earnings presentation. Indeed, the figures were its worst in 15 years. Its fourth-quarter operating profit went down 34.57 percent in comparison with 2022.
Samsung’s reported operating profit from the past quarter could not make investors happy. In fact, according to forecasts, it reported profits of 3.43 trillion Korean won, but the actual profit reported was 2.82 trillion Korean won (about $2.12 billion. Moreover, this was a 34.57 percent reduction from the same quarter in 2022.
Loss in the semiconductor business
A huge expense turned out to be the semiconductor unit. A record loss of 14.88 trillion Korean won was recorded there. A year earlier, that unit still turned out to be hugely profitable. Analysts believe 2022 was a favourable year because of the limited supply of semiconductors in the world.
Samsung blamed the loss on the normalizing chip prices during its presentation. Indeed, the chip shortage a year earlier drove up the prices of the limited supply of chips tremendously. Now that the shortages have been eliminated, the balance between supply and demand is restored.
Plans for the future
Of course, the company is doing all it can to see profits rise again. “We will focus on increasing sales of high value-added products to improve profitability.” To do this, it plans to capitalize on the demand for generative AI tools.
It will seek to maximize this technology in its upcoming offerings, including smartphones. The company is considering to make the technology available at an additional cost.