Samsung misses estimates as 5G contest with Apple heats up | Tech News

Samsung misses estimates as 5G contest with Apple heats up

Samsung shipped 41 million 5G devices in the past year, according to Strategy Analytics estimates, lagging behind Apple’s 52 million and Huawei’s 80 million sold largely at home in China.

By:BLOOMBERG
| Updated on: Aug 21 2022, 14:01 IST
Samsung shares rose as much as 1.8% in early Seoul trading on Friday.
Samsung shares rose as much as 1.8% in early Seoul trading on Friday. (REUTERS)

Samsung Electronics Co.'s profit for the fourth quarter missed analysts' estimates due to tepid smartphone sales and weak memory chip prices.

South Korea's biggest company posted operating income of 9 trillion won ($8.3 billion) for the three months ended December in preliminary results released Friday. That compares with a 9.52 trillion won average of analyst forecasts. Sales for the quarter were 61 trillion won. The company didn't provide net income or break out divisional performance, which it will report later this month when it releases final results.

You may be interested in

MobilesTablets Laptops
11% OFF
Samsung Galaxy S24 Ultra
  • Titanium Black
  • 12 GB RAM
  • 256 GB Storage
7% OFF
Apple iPhone 15 512GB
  • Black
  • 6 GB RAM
  • 512 GB Storage
5% OFF
Samsung Galaxy A25 5G
  • Blue Black
  • 8 GB RAM
  • 128/256 GB Storage
10% OFF
Samsung Galaxy A15 5G
  • Blue Black
  • 6/8 GB RAM
  • 128/256 GB Storage

Samsung shares rose as much as 1.8% in early Seoul trading on Friday.

Also read
Looking for a smartphone? To check mobile finder click here.

Galaxy smartphone sales were weaker in the quarter as Apple Inc. released its first 5G-compatible iPhones and Chinese rivals launched aggressive campaigns to secure the market share vacated by Huawei Technologies Co.'s sanction-stricken consumer business. Samsung shipped 41 million 5G devices in the past year, according to Strategy Analytics estimates, lagging behind Apple's 52 million and Huawei's 80 million sold largely at home in China.

The Suwon-based company plans to unveil its next flagship series, the Galaxy S21, earlier than its usual annual schedule with a Jan. 14 online event. Competitors like Xiaomi Corp., Oppo and Vivo are aggressively positioning themselves to fill the void expected to be left by Huawei in international markets.

Read more: Apple Supplier Murata Expects Half Billion 5G Phones in New Year

Memory chip prices fell owing to a slowdown in server demand, though that is expected to rebound starting in the current quarter, according to C.W. Chung, head of pan-Asia technology at Nomura Financial Investment. A stronger Korean won during the period also eroded Samsung's earnings.

“The company's mobile and memory businesses are set to recover from the first quarter,” Chung said ahead of the earnings release. “Server demand is rising on a potential DRAM shortage later this year. The upward trend in the memory market will accelerate and is likely to continue up to the end of 2021.”

​Fellow memory chipmaker Micron Technology Inc. issued a bullish forecast this week, predicting that the need for dynamic random access memory will likely exceed supply this quarter. The tightness of supply in DRAM is already driving up prices, according to Chief Executive Officer Sanjay Mehrotra. His company and Samsung will be competing for a share of what's expected to be a broad recovery in demand, led by the automotive sector and increased usage of more advanced, resource-intensive applications like artificial intelligence.

What Bloomberg Intelligence Says

“Sustained demand in 1H for cloud servers, smartphones and PCs, followed by increased IT spending in 2H, could spur DRAM bit growth of more than 20%. DRAM gigabytes per device may keep expanding amid AI and 5G use.”

- Anand Srinivasan and Marina Girgis, BI analysts

By Sohee Kim

Catch all the Latest Tech News, Mobile News, Laptop News, Gaming news, Wearables News , How To News, also keep up with us on Whatsapp channel,Twitter, Facebook, Google News, and Instagram. For our latest videos, subscribe to our YouTube channel.

First Published Date: 08 Jan, 07:52 IST
Tags:
NEXT ARTICLE BEGINS