Samsung reports worrisome Q4 2015 smartphone sales dip, forecasts small 2016 growth
The yet to be disputed mobile hardware heavyweight champion of the world has just come out with its financial figures for 2015’s final quarter and the year as a whole, having both good and bad news in store for investors, much like Apple and LG.
First, the bad, because it’s more palpable and there’s more to discuss on that front. Despite the holiday season traditionally improving demand for essentially everything that plugs in and connects to the web, Samsung saw a “slight” quarter-on-quarter decrease in smartphone shipments, which it blames on “year-end inventory adjustment and an increased portion of the mid- to low-end products.”
Sounds bad, and a “seasonal increase in marketing expenses” made things worse by “slightly” impacting profit. How slightly? Well, the mobile division pulled in around KRW 25 trillion ($20+ billion) in consolidated revenue and KRW 2.23 trillion ($1.8B) in operating profit between October and December 2015, which is indeed marginally down from KRW 26.29 trillion and up from KRW 1.96 trillion respectively the previous year.
All in all therefore, the situation isn’t as bleak as some analysts insist on making it seem like, with KRW 53.32 trillion in consolidated revenue and KRW 6.14 trillion in operating profit earned this past quarter. Also, a whopping total of KRW 200+ trillion and KRW 26.41 trillion for the full year that everyone besides Apple can only dream of.
Tablets represented another small bright spot in Samsung’s latest earnings recap, lifting both quarterly shipments and sales thanks to “seasonal demand”, especially for Galaxy Tab A and Tab S2 models.
Going forward, the Korean tech juggernaut expects smartphone and tablet popularity to dwindle during Q1 2016, but make a swift subsequent recovery and ultimately drive single-digit percentage growth in both categories. Research firms don’t necessarily agree, so perhaps the Galaxy S7 will be a bigger deal than we imagine.
Source: Samsung Newsroom