Samsung Electronics is now announcing its financial report for the fourth quarter of 2022. Samsung Electronics posted a net profit of 23.50 trillion won in the fourth quarter, against an estimate of 4.71 trillion won.
Samsung Electronics’ full-year revenue in 2022 will be 302.23 trillion won (about 245.5 billion U.S. dollars), a year-on-year increase of 8.1%, the highest in history. Fourth-quarter revenue was 70.5 trillion won ($57.2 billion), down 8 percent from a year earlier.
Samsung Electronics posted a fourth-quarter operating profit of 4.31 trillion won (5.82 trillion won estimated), as sales of MX smartphones slowed, as memory prices fell further and valuation losses on inventory assets.
Samsung Electronics’ sales were 70.46 trillion won (71.93 trillion won estimated), down 8.2 percent from the previous quarter, due to factors such as a slowing global economy and sluggish demand. On an annualized basis, however, sales still hit record highs from the previous year.
Samsung Electronics is said to have recorded 15.58 trillion won in consumer electronics revenue in the quarter, compared with analysts’ forecast of 15.48 trillion won. In addition, Samsung also pointed out that despite the decline in memory sales under difficult market conditions, the foundry business still achieved the highest quarterly sales.
Its facilities investment in the fourth quarter was 20.2 trillion won, of which DS was 18.8 trillion won and SDC was 0.4 trillion won. In terms of memory, investing in expanding the application of advanced technologies such as EUV to strengthen Pyeongtaek 3rd and 4th infrastructure construction and future competitiveness, and to secure next-generation R&D infrastructure, which focuses on expanding its production capacity in Pyeongtaek Advanced Process, and Establish 3nm initial capacity and infrastructure for the US Taylor factory to meet future needs; while SDC focuses on expanding small and medium-sized flexible production capacity and investing in infrastructure.
Samsung Electronics said consumer confidence deteriorated in the fourth quarter of last year and memory chip prices fell further. Samsung Electronics expects weak demand for equipment and chips in the first quarter. Smartphone demand is expected to decline year-on-year in the first quarter due to economic slowdown in major regions; affected by continued macroeconomic conditions, smartphone market demand is expected to decline in 2023. will shrink.
This year, Samsung’s DS (Device Solutions) division plans to further strengthen its market and technology leadership through infrastructure investments for the future, while increasing the proportion of high-tech processes and products such as DDR5, LPDDR5x and GAA (Gate-All-Around).
The memory chip business has always been the largest source of profit for the Samsung Group, and it is also the biggest boost to supporting other unprofitable businesses. However, the current sluggishness of Samsung’s memory chip business and even losses may affect the development of its mobile phone business, which in turn will affect the price of related mobile phone supply chains. and pull strategy. According to industry analysts, Samsung’s mobile phone business has already been hit hard by the cold wind in the mobile phone market, and now the memory chip business is also facing a collapse, which may cause Samsung to re-evaluate its strategic layout for the mobile phone market.
In addition, Samsung Electronics expects semiconductor equipment investment (CAPEX) to fall to about 32 trillion won this year from about 39 trillion won last year). Some analysts said that Samsung’s investment in the fourth quarter delayed part of the investment originally planned in the fourth quarter of last year to this year, which is far below expectations.
Samsung believes that the first quarter will continue the global IT demand slump and weak semiconductor market.
In terms of memory, Samsung Electronics plans to expand capacity reserves to meet the demand for DDR5 for servers and PCs, while actively responding to the demand for mobile high-capacity products such as LPDDR5x.
System LSI plans to expand sales of mid- and low-priced SoCs and 200-megapixel image sensors, and expand supply of automotive SoCs to European high-end OEMs and autonomous driving products.
Foundry revenue is also expected to trend downward due to lower demand due to slower global economic growth and inventory adjustments at major fabless companies, Samsung said.
In addition, SDC plans to actively respond to new product demand for small and medium-sized TVs, and secure additional demand for large screens by introducing new ultra-large TVs and large monitors.
Samsung’s MX division plans to expand sales of flagship products such as the Galaxy S23 and continue to strengthen sales of high-end tablets and wearable products. As competition intensifies in the smartphone market and the effects of the recession continue, the company plans to continue efforts to secure profitability, such as efficient resource management.
In terms of the communications business, its network plan focuses on new businesses while strengthening its overseas business base in North America and China. Looking ahead to 2023, the network plans to maintain sales growth by responding to the expansion of major overseas businesses in a timely manner, and continue to strengthen technology leadership such as 5G core chips and virtualized base stations (vRAN).
In home appliances, the company plans to expand sales of high-end products by launching new products such as the BESPOKE Infinite series, and focus on securing profitability through cost efficiency.
In other respects, VD plans to provide customers with a richer and more valuable user experience by strengthening product competitiveness and connectivity between devices and seizing the needs of the high-end market centered on 2023 Neo QLED.