Samsung Electronics is set to release its fourth-quarter results on Wednesday. Here are the key details:
Revenue Forecast
The preliminary forecast earlier this month indicated that the South Korean tech giant’s revenue may have fallen by 4.9% to 67,000 trillion won ($50.10 billion) in the quarter ending in December. Operating profit is expected to have dropped 35% to KRW2,800 trillion. According to a FactSet consensus forecast from 14 analysts, the company is likely to post a net profit of KRW3,358 trillion for the quarter, marking an 86% decrease from the previous year.
The stock price rose by 15% to KRW78,500 in the fourth quarter and is currently trading 1.4% higher at KRW74,400.
What to Watch For
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Semiconductor Business: Investors are eager to see if Samsung Electronics’ semiconductor business experienced a recovery despite its downbeat earnings in the final quarter of 2023. Analysts have previously predicted that this segment may improve due to higher semiconductor prices and growing demand for artificial intelligence chips. However, the weaker-than-expected operating profit forecast for the fourth quarter has tempered such optimism.
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DRAM and NAND Chip Businesses: Investors will be interested in whether the company’s DRAM chip business turned profitable or if its NAND chip business narrowed its losses in the December quarter. Although Samsung Electronics’ memory business recorded losses for a third consecutive quarter until September, the losses have been gradually decreasing.
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Outlook on Smartphone Business: The company’s outlook on its smartphone business in 2024 will be crucial, especially since it lost the top spot for annual smartphone shipments to Apple and became the world’s second-largest smartphone maker in 2023, according to industry trackers. Samsung Electronics recently launched its latest model, the Galaxy S24, with generative AI capabilities, aiming to drive new sales.
