Samsung's Q4 Profit Misses Estimates, Falls Sharply from Previous Quarter

Samsung Electronics, the world's leading electronics company, reported fourth-quarter earnings that missed analysts' estimates and fell sharply from the previous quarter. The company's operating profit for the quarter ended December 31, 2024, was KRW 6.5 trillion, down 29.2% from the previous quarter and below the market consensus of KRW 7.97 trillion. Revenue for the quarter was KRW 75 trillion, also falling short of the estimated KRW 77.4 trillion.



The decline in Samsung's fourth-quarter earnings can be attributed to several factors, including soft market conditions, particularly for IT products, increased R&D expenses, and weaker-than-expected sales of new smartphones. The company's semiconductor business, a significant contributor to its revenue, faced challenges due to weak demand for conventional PC and mobile-focused products, as well as higher R&D expenses aimed at securing future technology leadership and initial ramp-up costs for expanding the capacity of advanced manufacturing processes.

Despite the disappointing quarterly results, Samsung remains optimistic about its long-term growth prospects. The company plans to focus on leveraging its diverse business portfolio in combination with technological progress to drive a new phase of growth. Samsung aims to enhance its technological and product advantages in AI, continue to meet future demand for high-value-added products, and drive sales growth in premium segments.

Samsung's capital expenditures in 2024 reached a total of KRW 53.6 trillion, with KRW 46.3 trillion spent in the DS Division and KRW 4.8 trillion in SDC. In the fourth quarter, the total was KRW 17.8 trillion, with KRW 16 trillion allocated to the DS Division and KRW 1 trillion to SDC. The company's significant investment in R&D and capital expenditures demonstrates its commitment to securing technology leadership and maintaining its competitive edge in the global electronics market.



In conclusion, Samsung Electronics' fourth-quarter earnings missed estimates and fell sharply from the previous quarter due to soft market conditions, increased R&D expenses, and weaker-than-expected smartphone sales. Despite these challenges, the company remains focused on leveraging its diverse business portfolio and technological advancements to drive long-term growth. Samsung's significant investment in R&D and capital expenditures underscores its commitment to securing technology leadership and maintaining its competitive position in the global electronics market.