Samsung Electronics Co Ltd is closer to losing its crown as global smartphone leader after posting a plunge in quarterly mobile earnings yesterday, a day after rival Apple Inc reported the biggest profit in corporate history.
The South Korean giant said earnings from smartphones and other mobile gadgets dropped 64 percent annually in the October to December period last year to 1.96 trillion won (US$1.80 billion), contributing to its first annual earnings fall in three years.
It was the mobile division’s fifth consecutive quarter of decline, in contrast to Apple’s record-breaking 74.5 million iPhone sales in the three months to Dec. 27 last year on the back of the success of its big-screen iPhone 6 and 6 Plus.
Analysts said Samsung is under immense pressure to hang on to its market share, with a lot resting on the launch of its next flagship Galaxy S6 high-end smartphone due around March.
“I think after learning a hard lesson, we’ll see a significant improvement in terms of design, build quality and on the specs... The question right now is whether this is enough,” Maybank Kim Eng analyst Warran Lau (劉華仁) said.
While Samsung did not release smartphone sales figures, it said smartphone and tablet shipments declined in the fourth quarter, leading some analysts to declare Apple had caught up.
“Apple’s new iPhone 6 and 6 Plus models are proving wildly popular in China, United States and Europe. Apple tied with Samsung to become the world’s largest smartphone vendor for the first time since Q4 2011,” Strategy Analytics executive director Neil Mawston said in a statement.
Mobile’s share of Samsung’s operating profit fell from almost 70 percent in 2013 to about 58 percent last year. The company expects shipments and average selling prices for handsets to pick up in the first quarter following the launch of new mid-tier models such as the Galaxy A.
The semiconductor division was a bright spot as Samsung posted fourth-quarter operating profit of 5.3 trillion won, in line with the 5.2 trillion won profit the firm predicted earlier this month.
The result put the firm’s profit last year at 25 trillion won, down from a record 36.8 trillion won in 2013 and the lowest since 2011.
“Uncertainties for global business conditions will likely grow further in 2015 due to the slowing Eurozone economy and financial risks in emerging countries,” Samsung said in a statement.
The semiconductor division’s profit stood at 2.7 trillion won, its highest in more than four years, helping Samsung recover from a 60 percent drop in operating profit in the third quarter.
Samsung said it saw healthy demand for memory chips, used in servers and handsets including Apple iPhones, as well as improved sales from its system chips business. It expects to outpace overall industry shipments growth for DRAM and NAND chips this year.
Even so, analysts expect Samsung to report its second straight annual profit decline this year, unless it can reinvigorate the mobile division.
The company said it would pay an end-2014 dividend of 19,500 won per common share, up 41 percent from the end-2013 dividend of 13,800 won per share, a sign it is eager to appease shareholders.
Taiwan Transport and Storage Corp (TTS, 台灣通運倉儲) yesterday unveiled its first electric tractor unit — manufactured by Volvo Trucks — in a ceremony in Taipei, and said the unit would soon be used to transport cement produced by Taiwan Cement Corp (TCC, 台灣水泥). Both TTS and TCC belong to TCC International Holdings Ltd (台泥國際集團). With the electric tractor unit, the Taipei-based cement firm would become the first in Taiwan to use electric vehicles to transport construction materials. TTS chairman Koo Kung-yi (辜公怡), Volvo Trucks vice president of sales and marketing Johan Selven, TCC president Roman Cheng (程耀輝) and Taikoo Motors Group
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
RECORD-BREAKING: TSMC’s net profit last quarter beat market expectations by expanding 8.9% and it was the best first-quarter profit in the chipmaker’s history Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), which counts Nvidia Corp as a key customer, yesterday said that artificial intelligence (AI) server chip revenue is set to more than double this year from last year amid rising demand. The chipmaker expects the growth momentum to continue in the next five years with an annual compound growth rate of 50 percent, TSMC chief executive officer C.C. Wei (魏哲家) told investors yesterday. By 2028, AI chips’ contribution to revenue would climb to about 20 percent from a percentage in the low teens, Wei said. “Almost all the AI innovators are working with TSMC to address the
FUTURE PLANS: Although the electric vehicle market is getting more competitive, Hon Hai would stick to its goal of seizing a 5 percent share globally, Young Liu said Hon Hai Precision Industry Co (鴻海精密), a major iPhone assembler and supplier of artificial intelligence (AI) servers powered by Nvidia Corp’s chips, yesterday said it has introduced a rotating chief executive structure as part of the company’s efforts to cultivate future leaders and to enhance corporate governance. The 50-year-old contract electronics maker reported sizable revenue of NT$6.16 trillion (US$189.67 billion) last year. Hon Hai, also known as Foxconn Technology Group (富士康科技集團), has been under the control of one man almost since its inception. A rotating CEO system is a rarity among Taiwanese businesses. Hon Hai has given leaders of the company’s six