Samsung just announced that for the final quarter of the year 2014, it posted decreasing earnings. This marks the first time in a period of three years that the South Korean phone maker has generated decreasing sales during the holiday season.
Still, Samsung's most recent holiday quarter was not as bad as its previous quarters. The tech giant still managed to report an operating profit in the amount of $4.87 billion from a total revenue of $48.6 billion.
By all counts, $4.87 billion is still an impressive profit, but compared to last year's 7.65 billion, it is definitely not an improvement. And if you look at the total quarterly revenue of $48.6 billion, it is still noticeably down from the $54.585 billion revenue generated last year.
It is no secret that Samsung has been struggling a bit in its operations in the past year, especially in its IT and mobile communications segment. And it does not help that its fiercest rival Apple released last year two of their best-selling smartphones ever, with the iPhone 6 and the iPhone 6 Plus registering record sales numbers. Furthermore, Samsung has to fend off serious threats from Chinese phone makers like Lenovo and Xiaomi whose penchant for producing budget-friendly mobile devices with okay features is helping erode some of the South Korean company's vulnerable market share. Internally, the company also went through a lot of changes during the past quarter. It re-organized most of its mobile executive roster, and even let go of some high-level employees.
On the positive side, Samsung stated that its high-end smartphone offerings are doing well, despite fierce competition from Apple and Chinese mobile manufacturers. The South Korean company even singled out its Samsung Galaxy Note 4 as having increasing sales numbers.
And Samsung is actually posting increasing profit figures for its semiconductor segment. Apart from being a phone maker and consumer electronics manufacturer, Samsung also produces memory chips. During the last quarter, the South Korean company posted a profit of $2.4 billion on its chip set production.
All well and and good for Samsung's chip division. And recent signs indicate that this segment of the company will continue to grow and post a profit. It appears that Samsung will be manufacturing its own smartphone chips from now on, instead of relying on Qualcomm and paying the costs of using a third party's wares. Also, Samsung will be making 75% of the chips needed for Apple's new generation of iPhones, which means in the next few years, the South Korean's chip division will have a lot of job orders to fulfill.
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