Samsung mobile Q4 profits down by almost two thirds on last year

Over the course of 2014, Samsung's mobile and IT division has seen its yearly operating profits fall by over 40 percent compared to 2013, dragging the rest of the company's yearly profit down by nearly one third.

Samsung Electronics' mobile and IT (IM) division, the profit driver for the Korean conglomerate in recent years, has seen its fourth-quarter operating profit plummet to 1.96 trillion won ($1.8 billion) from the 5.47 trillion won posted for the same time in 2013.

Full-year figures for 2014 reveal that Samsung's IM division saw its yearly profit fall by over 40 percent, from 24.96 trillion won to 14.56 trillion won. The division gained 112 trillion won in sales for the year, which represented a 19 percent decline on 2013.

For the entire company, full-year operating profit was down by 11.8 trillion won to 25 trillion won, on a 10 percent reduction in sales over the year to 206 trillion won. Samsung Electronics' fourth-quarter profit came in at 5.3 trillion won, from 8.31 trillion won at the same time in 2013.

Over the course of the year, the only segment of the company that saw any sales or profit growth was the semiconductor business, which grew yearly profits by 1.89 trillion won to 8.78 trillion won, and saw sales for the full year jump by 6 percent to 39.73 trillion won.

The company's memory business saw sales grow by 24 percent, bringing in 29.32 trillion won of sales over the course of the year.

In comments accompanying the results, the company said its semiconductor business expects DRAM demand to grow, thanks to new mobile operating systems and higher-resolution displays in smartphones, as well as NAND demand to increase for mobiles, servers, and PCs.

By contrast, the IM division said it expects smartphone competition to intensify, with demand driven by long-term evolution (LTE) and emerging markets, and tablet growth to continue in the mid to low end of the market.

The fourth-quarter results continue a dismal run for the Korean electronics giant, which saw its third-quarter profit fall by 49 percent, and second-quarter profits plunge by 25 percent.

After the second-quarter results, executives in the mobile division returned a quarter of their bonuses.

Reports emerged earlier this week that Samsung's semiconductor division would be responsible for 75 percent of the chip production of the next iPhone.

Samsung teams up with Qantas

Samsung has also announced a partnership with Qantas to trial its virtual reality (VR) technology in selected lounges and flights to bring a 360-degree interactive format to inflight entertainment.

As part of the trial, Samsung Gear VR headsets will showcase sights of network destinations, new Qantas products, and the latest inflight blockbuster movies.

The headsets will be available to customers in the Sydney and Melbourne international first-class lounges from mid February, as well as in the first class cabins on select A380 flights between Australia and Los Angeles from mid March.

The trial will run for three months to assess customer feedback on how the VR might add to people's overall travel experience on long-haul flights.

Qantas group executive for brand, marketing, and corporate affairs, Olivia Wirth, said the technology will give the company a new way to entertain its guests.

"Whether the user wants a virtual tour of our new Los Angeles first lounge or experience an A380 landing from the tarmac, this technology gives us a completely new way to connect with our customers," she said.


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