Samsung Sales, Profits Off In Q1

CE and mobile divisions down, semiconductors up
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CE and mobile divisions down, semiconductors up

Seoul, South Korea – Samsung’s global sales and profits fell in the first quarter, and the company’s consumer electronics division posted an operating loss.

Consolidated sales were off 12.2 percent to 47.1 trillion won ($44 billion) compared to the year-ago quarter, while operating profits slipped 30 percent to 5.98 trillion won ($5.6 billion). Net profit fell 38.8 percent to 4.63 trillion won ($4.3 billion) from the year-ago quarter.

In the CE division, sales fell 9.4 percent to 10.3 trillion won ($9.6 billion), and the division posted an operating loss of 140 billion won ($131 million) compared to a year-ago 19 trillion won operating profit. The division includes TVs, appliances, printing solutions, and health and medical equipment.

In the IT and mobile communications division, consisting almost exclusively of cellphones, sales were off 20 percent to 25.9 trillion won, and operating profits were down 57.4 percent to 2.74 trillion won.

In the device solutions segment, which includes display panels and semiconductors, sales were up 10 percent to 10.3 trillion won, and operating profit was up 81 percent to 3.4 trillion won.

In the CE division, demand for flat-panel TVs decreased in part because of falling exchange rates in Europe, Russia and Brazil, the company said. An increase in material costs due to the strong U.S. dollar further contributed to operating losses. Appliances, however, improved earnings compared to the year-ago quarter because of increased sales of premium products, the company said.

The IM division will drive smartphone sales growth in 2015 “by strengthening its leadership in premium smartphones and actively responding to the growing middle- to low-end market with a streamlined lineup,” the company said. Samsung said it will improve the division’s profitability by increasing efficiencies in R&D, marketing and other areas.

The Korean won was converted at a rate of $1=1,070 won.


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