SEOUL, January 08 (AJP) - Samsung Electronics reported an operating profit of 6.5 trillion won ($5.4 billion) for the fourth quarter of 2024, falling significantly short of market expectations despite a year-over-year increase of 130.5 percent.
The earnings, disclosed in a preliminary report on Wednesday, marked a 29.2 percent decline from the previous quarter’s 9.2 trillion won profit and fell 15.7 percent below the market consensus of 7.7 trillion won.
Analysts had initially projected operating profit to reach approximately 10 trillion won but revised estimates downward to the 7-trillion-won range amid weakening market conditions. Even with adjusted forecasts, Samsung failed to meet expectations.
Revenue for the quarter stood at 75 trillion won, reflecting a 10.7 percent increase from the same period a year earlier but a 5.2 percent decline from the previous quarter.
The underwhelming performance reflects a deeper-than-expected slump in global demand for smartphones and personal computers, which has significantly impacted Samsung’s memory chip business, a core pillar of its operations. Legacy memory products, which form the bulk of Samsung’s offerings, faced a sharp decline in profitability due to an oversupplied market and continued inventory adjustments by major clients.
Prices for memory chips have plummeted, and Samsung’s shipment volumes and average selling prices fell short of expectations.
While the ongoing AI boom has spurred strong demand for high-bandwidth memory (HBM) chips, Samsung’s delayed production ramp-up of these high-margin products has limited their contribution to the company’s bottom line.
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