Samsung Electronics Q1 earnings plunge but beat expectations

The company remained cautious about demand going forward due to the global recession

Samsung Electronics reported better first quarter earnings than analysts expected on Friday, led by its mobile phone division, but remained cautious about business going forward due to the global recession.

The world's largest memory chip and LCD panel maker said its net profit fell 72 percent year-on-year to 620 billion Korean won (US$461.7 million), while its revenue grew 9 percent to 18.97 trillion won.

The company reported stabilizing memory chip and LCD panel prices as well as better profit margins in its mobile phone division.

But Samsung remained cautious overall about sales going forward.

"It's very difficult to gauge the demand outlook," said Robert Yi, vice president of investor relations at Samsung, during a conference call.

In mobile phones, which turned in a good performance for Samsung in the first quarter, the company predicted emerging markets will continue to drive handset demand this year.

But, "demand in emerging markets is slowing down," said Kim Hyungdo, a vice president in Samsung's telecommunications division.

LCD panels, the screen part of computer monitors and laptop PCs, have benefitted from price increases recently, but the company was unsure that could last.

"We will monitor whether LCD panel prices continue to rise despite sluggish economic conditions," said Cho Yeongduk, a vice president in Samsung's LCD Business.

Rising prices for memory chips such as DRAM and NAND flash memory may also be short lived.

Price increases will lead to production increases and that will send prices down again, said Cho Namseong, a senior vice president in Samsung's semiconductor business.

He noted that there are still too many idled production lines in the memory chip sector that could come back online as memory chip prices increase, only to flood the market again.

"We aren't seeing any clear indication of demand improvement," he said.

One analyst on the conference call noted that Samsung's view of the market going forward was less upbeat than other technology companies and asked what Samsung saw that other companies might not be seeing out in the market.

"I'm actually quite interested to know what they see that we don't see," said Yi.

Join the Good Gear Guide newsletter!

Error: Please check your email address.

Tags samsungfinancial results

Our Back to Business guide highlights the best products for you to boost your productivity at home, on the road, at the office, or in the classroom.

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Dan Nystedt

IDG News Service
Show Comments

Most Popular Reviews

Latest News Articles

Resources

PCW Evaluation Team

Azadeh Williams

HP OfficeJet Pro 8730

A smarter way to print for busy small business owners, combining speedy printing with scanning and copying, making it easier to produce high quality documents and images at a touch of a button.

Andrew Grant

HP OfficeJet Pro 8730

I've had a multifunction printer in the office going on 10 years now. It was a neat bit of kit back in the day -- print, copy, scan, fax -- when printing over WiFi felt a bit like magic. It’s seen better days though and an upgrade’s well overdue. This HP OfficeJet Pro 8730 looks like it ticks all the same boxes: print, copy, scan, and fax. (Really? Does anyone fax anything any more? I guess it's good to know the facility’s there, just in case.) Printing over WiFi is more-or- less standard these days.

Ed Dawson

HP OfficeJet Pro 8730

As a freelance writer who is always on the go, I like my technology to be both efficient and effective so I can do my job well. The HP OfficeJet Pro 8730 Inkjet Printer ticks all the boxes in terms of form factor, performance and user interface.

Michael Hargreaves

Windows 10 for Business / Dell XPS 13

I’d happily recommend this touchscreen laptop and Windows 10 as a great way to get serious work done at a desk or on the road.

Aysha Strobbe

Windows 10 / HP Spectre x360

Ultimately, I think the Windows 10 environment is excellent for me as it caters for so many different uses. The inclusion of the Xbox app is also great for when you need some downtime too!

Mark Escubio

Windows 10 / Lenovo Yoga 910

For me, the Xbox Play Anywhere is a great new feature as it allows you to play your current Xbox games with higher resolutions and better graphics without forking out extra cash for another copy. Although available titles are still scarce, but I’m sure it will grow in time.

Featured Content

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?