Samsung posts 5.1 billion profit in Q4 2015

It is the first time in five quarters the company posted a negative on-quarter growth in operating profit.

A man tries out a Samsung Electronics mobile device at its headquarters in Seoul January 6, 2016.

In an earnings estimate, the South Korean tech giant predicted an operating profit of 6.1 trillion won (US$5.1 billion) for the October-December period, up from 5.4 trillion won a year earlier.

While Samsung’s semiconductor division posted a record operating profit of 3.66 trillion won in the third quarter, industry watchers estimate the figure to be around 3.1 trillion won to 3.2 trillion won for the fourth quarter.

Tech giant Samsung Electronics Co Ltd said today its fourth-quarter operating profit likely rose 15 per cent from a year earlier, missing expectations and fuelling concerns the tech industry may be in for a tough year of slack gadget sales.

The company said its sales were likely to be 53 trillion won in the quarter, up from 52.7 trillion won in the same quarter a year ago.

Samsung does not break up the performance of its various divisions or provide net profit information until its release of audited results later this month.

Analysts have recently lowered their forecasts on Samsung’s earnings for the final quarter of 2015, citing weak global demand for personal computers and smartphones that hurt its semiconductor business.

The estimate hovered slightly below the market consensus of 6.5 trillion won by 16 South Korean brokerage houses, according to data compiled by Yonhap Infomax, the financial arm of Yonhap News Agency.

This investment in the factory, which is to begin production in 2017, is the largest the firm has ever committed to a single plant.

Shares of Samsung Electronics Co. closed 0.69 percent higher at 1,171,000 won on Friday, with the benchmark KOSPI advancing 0.7 percent. Vice Chairman Lee Jae Yong, heir apparent to South Koreas biggest conglomerate, last month replaced the head of its mobile business as part of an annual management overhaul, signaling a change in direction to focus on software innovations.