Samsung Q4 2015 earnings shows tenuous recovery

by: Robert TriggsJanuary 8, 2016


Samsung Electronics has just posted its fourth quarter earnings guidance, which reveals some mixed fortunes for the technology giant. Between October and December, Samsung’s operating profit came in at around 6.1 trillion Korean won (USD$5.1 billion), up from 5.3 trillion won last year. This marks a notable 15 percent increase and suggests that profits are undergoing a small recovery. However, this amount falls short of analyst estimates. Many had expected Samsung to post a profit of around 6.6 trillion won.

To put this in perspective, Samsung’s quarterly revenue has remained virtually unchanged at 53.0 trillion Korean won against 52.7 trillion won in the same quarter last year. Samsung’s efforts to cut costs and improve profitability this year have clearly worked out, but the company does not appear to have been able to improve its sales position.

Samsung products:

Samsung’s declaration does not give a full breakdown of the performance of each of its business divisions, those will follow later this month. However, analysts are anticipating that smartphone sales have continued to feel the impact of lower cost Chinese competitors and a generally poor global economic outlook.

Instead, the company is expected to have missed analyst targets due to a stall in Samsung’s component and semiconductor businesses. Demand for flash memory may have been impacted by lower global demand for electronics, while Samsung’s display panel business has seen increasing competition from Chinese manufacturers and falling prices this year. These areas of Samsung’s business had been offsetting the company’s decline in smartphone revenue.

samsung logo mwc 2015 8See also: Samsung CEO warns of tough year ahead25

It isn’t just market analysts that are concerned about the tenuous recovery to Samsung’s operating profits, the company’s CEO recently warned that 2016 would be another tough year for the company. The electronics giant is preparing to face intensifying competition to its smartphone, TV and memory chip businesses this year. Interestingly, the company is looking to put more of an emphasis on using software to help differentiate its products from those of its rivals in 2016. Samsung has been making a big show of its services, such as Samsung Pay, at CES 2016.

A more detailed breakdown of Samsung’s Q4 2015 finances is expected later in the month.

  • saksham

    do not lose the grip samsung !

  • Diego

    Another samsung bashing article.
    The bashing of samsung must go on.

  • V-Phuc

    Love it every single time I read “something something …falls short of analyst expectations”. Really?!!! A profit of 5.1 billions is still called short of expectations. What did such analysts expect? 100 billions? Might as well throw in a few more zeros after the “1”, right? LOL. How about these guys get out on the street and sell phones on the street corner to help Samsung “meet their expectations”?!!!
    As for me, no tear shed for Samsung falling short of expectations. 5.1 billions profit! Really? Hey, if you don’t want it, just let me know and send the check to my home. I’ll take it such “tiny” profit.

  • Daggett Beaver

    Has anyone been reading what’s happening to Apple lately?

    It’s the ECONOMY, stupid. Everyone’s profits are being affected.

    • lrd555

      Apple’s going to post over $20 Billion profits for the last quarter. 10X Samsung’s mobile profits. All you’re hearing is unfounded rumors by which Wall Street’s trying to manipulate share prices in order to ditch their loses and hopefully recover their loses when they force the market back up by more unfounded rumors. It all started with Credit Suisse, who’s losing 100’s of millions due to Apple decimating the Swiss watch market, wanting to rebalance their asset holdings by claiming iPhone cuts for spring 2016! Like duh, of course sales peak during the holiday season. When the others saw that this technique can work, which was tried like the last 3 years, they too started deploying paid bloggers to carefully sell and rebalance thier capital holdings.

      • The-Sailor-Man

        Just sell !!! You could thanks my latter.

  • lrd555

    Two more Apple stores opening up in China this weekend and the next. More stores coming to Latin American countries. AppleTV is red hot and will soon start to have a halo affect on the phones. Recovery for Samsung is pretty much impossible.

    • The-Sailor-Man

      More like – ‘Recovery for Apple is pretty much impossible’.

      Samsung is shooting almost every month with great new tech. Soon the apple’s propaganda will not be able to mute it.

      It the tech world, those who hold the newest-greatest tech , soon or later prevail . Not those who count only on pink or gold color, and old cheap tech. No matter how much stores they have.

  • The-Sailor-Man

    Kudos to Samsung, that manage with the profit, but not saving from R&D and investment in new tech.
    Not only in pink and gold colors like some ‘posh’ company.

    And besides, even without Note 5 in EU and globally.

  • The-Sailor-Man

    LOL . Even AA can’t afford bashing Samsung harder?

  • Karly Johnston

    Semi-conducters up, mobile sales down… folks not too happy losing battery and micro sd options.