Computer slump knocks 10% off Samsung profits
Saturday 19 April 2003
Samsung Electronics said yesterday that its profits had fallen by two-fifths because of of a slump in memory chip prices.
The South Korean technology giant said that it had been forced to cut prices every two weeks in order to attract customers in the first three months of the year.
The first-quarter profit figure was worse than investors had expected, with weak demand for computer equipment seen as the main factor.
However, shares in Samsung, which is the world's top memory chip maker but also makes a wide range of electronics products, rose.
The company called the outlook "cloudy", but said PC demand might pick up soon and cash-strapped rivals makers were unlikely to add capacity at their semiconductor factories.
The company, best known for sleek colour-screen mobile phones with features such as tiny cameras and voice dialling, said handset sales rose 14 per cent from the previous quarter.
Average selling prices slipped 5 per cent as it shifted its focus to lower-cost phones to boost its market share, but this should rebound later in the year when it rolls out new top-of-the-range models.
Samsung has doubled its share of the global handset market to 10 per cent in two years, overtaking Germany's Siemens and Sony Ericsson. It is now challenging the mobile phone giants Motorola and Nokia. The company sold 13.2 million mobile phones in the first quarter, up from 11.6 million in the fourth quarter.
Growth in this division is being driven by innovative designs, cutting-edge technology and aggressive marketing in Europe and the United States. Samsung said it aimed to sell 13 million mobile phones in the second quarter and 52.5 million for all of 2003.
Samsung earned a 1,130bn won ($937.7m) net profit in the first quarter, falling short of analysts' consensus forecasts of 1,370bn won. This compared with a 1,910bn won profit a year ago.
Turnover fell to 9,600bn won from 9,930bn won.
Samsung shares rose 4.3 per cent to close at 315,000 won on the back of a global technology rally triggered by a solid handset sale growth forecast from Nokia on Thursday.
Children's bookseller wins The Independent's new author search
Board creates magnetic field to achieve lift
- 1 Jack the Ripper: Scientist who claims to have identified notorious killer has 'made serious DNA error'
- 2 Banksy arrest hoax: Internet duped by fake online report claiming artist's identity has been revealed
- 3 Former East 17 frontman Brian Harvey turns up at Downing Street and 'demands to speak to Prime Minister'
- 4 Kentucky gang rape: 15-year-old boy left in critical condition after sexual attack by group at party
- 5 Paralysed man Darek Fidyka walks again after treatment by British doctors on brink of 'cure'
Jack the Ripper: Scientist who claims to have identified notorious killer has 'made serious DNA error'
Oscar de la Renta dead: Legendary US fashion designer dies after long cancer battle aged 82
Oscar Pistorius: The brutal prison life that awaits disgraced athlete
Banksy arrest hoax: Internet duped by fake online report claiming artist's identity has been revealed
Super-sized ships arrive in Britain: How big can they get?
Cameron is warned 'no possibility' of UK reducing immigration and that bid to bring in quota on migrant workers would be illegal
Residents should throw a street party and mix with immigrant neighbours, councils told
Russell Brand threatened with arrest after filming outside Fox News headquarters
London bus driver 'kicks gay couple off for kissing'
Lord Freud: Tory welfare minister apologises after saying disabled people are 'not worth’ the minimum wage
Lord Freud hangs on as MPs of all parties 'call for his head' over disability comments
iJobs Money & Business
£23000 per annum + pension and 22 days holiday: Ashdown Group: An established ...
£27000 per annum + pension, 22 days holiday: Ashdown Group: An established ind...
£23000 - £26000 Per Annum: Clearwater People Solutions Ltd: Our client is curr...
£25 - 30k: Guru Careers: A Corporate Actions Administrator / Operations Admini...