Samsung puts Q4 operating profit at 8.8 trillion won
Published : 2013-01-08 08:58
Updated : 2013-01-08 10:39
Samsung Electronics Co., the world's biggest technology firm by revenue, estimated Tuesday it had posted a record operating profit of 8.8 trillion won ($8.3 billion) in the fourth quarter of 2012, and is poised to log record annual earnings on the back of its smartphone dominance.
The preliminary estimate represents an 88.8 percent jump from a revised operating profit of 4.66 trillion won a year earlier, Samsung said in a regulatory filing. It is also a 9.2 percent increase from the previous three months.
Fourth-quarter sales were estimated at 56 trillion won, also up 18.4 percent from a year earlier, according to the company's earnings guidance, which did not provide figures for each of its business divisions.
The figures are higher than the 8.72 trillion won operating profit and 55.8 trillion won revenue projected by Yonhap Infomax, the financial news arm of Yonhap News Agency.
Samsung, also the world's leading smartphone and memory chip maker, did not disclose its net profit estimate. It is scheduled to announce its fourth-quarter earnings later this month.
If the quarterly estimate is on track, Samsung is set to log an annual revenue and operating profit of 201.05 trillion won and 29.01 trillion won, respectively.
While Samsung did not provide reasons for the on-quarter increase, analysts said strong smartphone sales as well as seasonal demand for electronics products strengthened its bottom line.
By business unit, Samsung is estimated have reaped 5.9 trillion won from its IT and mobile division, followed by a 1.6 trillion won operating profit in semiconductors, 1.2 trillion won in display and 400 billion won in consumer electronics in the fourth quarter, according to KDB Daewoo Securities Co.
"Robust sales of Samsung's flagship products Galaxy S3 and Galaxy Note 2 helped set off negative factors such as a rise in fourth-quarter marketing costs," KB Investment & Securities Co. analyst Byun Han-joon noted ahead of the announcement.
Samsung is estimated to have sold 63 million smartphones out of total handset sales of 110.5 million units in the three-month period, according to Byun.
As of November, Samsung sold more than 30 million Galaxy S3 phones and more than 5 million Galaxy Note 2 phablets. The flagship phone was released in May while the bigger 5.5-inch phablet was launched in September.
Analysts projected Samsung's IT & Mobile Communications division to keep up its lucrative performance. The handset division is estimated to generate more than half of its overall revenue.
KDB Daewoo Securities analyst James Song wrote in a recent report that Samsung is expected to ship 300 million smartphones this year, buoyed by positive response for the yet-to-be released "Galaxy S4" or "Tizen" phone.
As part of efforts to diversify its operating system, Samsung has been involved in the Tizen Association along with chipmakers, mobile carriers and handset manufacturers such as Intel Corp. and NTT DoCoMo Inc.
A launch date for the Tizen phone has not been disclosed, while analysts expect Samsung to roll out a new phone in the second quarter.
Meanwhile, some projected Samsung's march toward record earnings to slow in the January-March period.
"An absence of a new phone may dent Samsung's profit in the first quarter ahead of gaining traction in the second quarter when a new device is released," IBK Securities Co. analyst Lee Seung-woo said by phone.
Lee projected Samsung to set another annual record profit this year, but added currency risks linger in the January-March period.
Shares of Samsung were trading at 1,504,000 won on the Seoul bourse as of 9:57 a.m., down 1.05 percent from Monday's close. (Yonhap News)