Samsung Electronics’ earnings for the final quarter of 2015 have plunged 40% compared with a year earlier.
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Operating profit was 6.14 trillion won (5.08 billion USA dollars) during the October-December period, down 16.92 percent from 7.39 trillion won in the previous three months, a regulatory filing showed Thursday.
Samsung said that unfavorable foreign exchange rates caused a currency loss of about 400 billion won during the quarter. Its operating profit came to 26.4 trillion won, up 5.55 percent from the previous year, but sales dropped 2.69 percent to 200.6 trillion won.
Tech giant Samsung Electronics Co Ltd on Thursday warned of possible weaker earnings this year due to softer sales of gadgets such as smartphones, a trend that is also hurting rival Apple Inc and major chipmakers.
The IM Division posted KRW 25.00 trillion in consolidated revenue and KRW 2.23 trillion in operating profit for the quarter. Operating profit, meanwhile, dropped 17 percent to 640 billion won.
The market decline happened partly because HP spun off its enterprise business, which bumped Toshiba from the top 10.
Samsung isn’t expecting much better.
The California technology colossus said it expects to see its first decline in iPhone sales in the current quarter on a year-on-year basis. Led by the Samsung Galaxy Tab A and the svelte Samsung Galaxy Tab S2, tablet sales rose in the quarter to 9 million units.
“Samsung rolled out the Note 5 and S6 Edge Plus devices a little earlier than usual, but the total share of its high-end smartphone shipment has still declined”, Greg Roh, an analyst at HMC Investment Securities, said in Seoul before the earnings release.
Losses in Samsung’s mobile division during 2015 were partially mitigated by brisk business in chips and displays.
The company also said smartphone sales will face challenges due to the slowing global market, adding it will continue to streamline its smartphone series for efficiency. The early releases of new products failed to spark the company’s sales while Apple, Samsung’s biggest customer, on Tuesday forecast its first sales decline in more than a decade.
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In the fourth quarter, TV market demand increased significantly entering the year-end peak season. It is also the world’s largest maker of smartphones and television sets.
