Samsung’s first-quarter earnings plunged despite strong sales of smartphones

Samsung’s first-quarter earnings plunged despite strong sales of smartphones

As predicted, Samsung’s first quarter 2023 financial report showed a drop in profits to levels not seen in the prior 15 years.
Profit between January and March fell from KRW 14.12 trillion to KRW 0.64 trillion, a reduction of 95%. Operating profit fell 18% year over year.

Samsung believes that a revival in worldwide demand will help the company in the second half of this year.

The department in charge of smartphones and other smart devices, known as “mobile experience,” suffered the least during this dismal quarter.

Annual sales were down 2%, but quarterly sales were up 22%. Weakness in key international areas like North America and South and West Asia had a minor impact on the related network business, although year-over-year and quarterly operating profit improved.

The release of the new premium smartphone models in the Galaxy S23 series, especially the S23 Ultra, is credited with the boost in quarterly sales. Efforts were also made to boost productivity in the workplace.

The company has verified that sluggish demand and client inventory adjustments are to blame for the downturn in the memory and semiconductor industries.

As the market for mobile panels shrank, the display industry also underwhelmed, though the large panel industry helped mitigate the losses to some extent. The strength of the Korean won against the US dollar also had a severe effect, especially on the component industry.

It is anticipated that the current market patterns will carry on into the next quarter, which concludes in June. In order to keep up with rising demand for DDR, LPDDR5X, and other high-end products, the DS Division will prioritize improving the gate-all-around (GAA)-based 2nm process. The Korean manufacturer’s focus on cost optimization in Q2 will have a positive effect on profits in the near and distant future.