Samsung has announced its financial result for the first quarter of 2014 that ended on March 31, 2014. The final reported revenues of Samsung Electronics reached 53.68 trillion won, about 9 percent down from Samsung’s previous quarter. This is the second consecutive quarter that has seen a drop in Samsung’s earnings but Samsung claims it “saw gains compared to the same period last year.”
The consolidated operating profit stood at 8.49 trillion won – a 2 percent increase quarter-on-quarter and net profit rose by 270 billion won to 7.57 trillion won.
Moving forward, Samsung expects the revenues to increase due to improved sales of display panels and home appliances and to sustain growth, they’ll concentrate on its core business areas.
Here’s an individual breakup of each business.
Semiconductors:
Samsung’s Semiconductor businesses comprises of Memory and System LSI units that posted an operating profit of 1.95 trillion won on 9.39 trillion won in consolidated revenue. The Memory chip business contributed bulk of the sales with 6.29 trillion won in revenue but saw a 3-percent decrease in gains quarter-on-quarter.
In Q2, Samsung expects server and graphic related DRAM demand to remain strong and will continue to enhance profitability by improving cost competitiveness through the expansion of 20-nanometer class process migration and increasing offerings of high value-added differentiated products.
For System LSI, Samsung does not expect a strong demand for its high-end mobile AP (Exynos) but expects to see some growth.
Display Panel:
The Display Panel business recorded a revenue of 6.10 trillion won with an operating loss of 80 billion won. Samsung blames the weak quarter on “weak seasonal demand”.
Samsung expects a good quarter ahead due to demand related to the FIFA World Cup.
IT & Mobile Communications (IM):
The IT & Mobile Communications (IM) division consisting of Mobile Communications and Networks is yet again the star of this year’s results. It posted operating profits of 6.43 trillion won on 32.44 trillion won in revenue with the mobile business contributing 31.36 trillion won.
Samsung saw the IM division revenue jumped 18 percent despite a decrease of market demand of both smartphones and tablets. While Samsung doesn’t divulge smartphone shipment numbers, they did confirm to ship 13 million tablets this quarter.
Although the next quarter will be more or less the same, Samsung expects a slight increase in the demand with a continued momentum, thanks to Galaxy S5.
Consumer Electronics:
The Consumer Electronics Division – encompassing the Visual Display, Digital Appliances, Printing Solutions and Health and Medical Equipment businesses – posted an operating profit of 190 billion won for the quarter on revenues of 11.32 trillion won. The Visual Display business accounted for 7.39 trillion won of earnings.
For Q2, Samsung expects demand for UHD TVs to rise further while expect small increase in the demand of home appliances.
Plain and simple nothing beats Samsung period or matters most at the end of the day.