Samsung's Chip Business Buoys Q4 Earnings; Q1 TV Shipments May Drop, It Says

Samsung’s chip business propped up earnings in Q4, offsetting flat CE sales hit by the Galaxy Note7 recalls and production shutdown in October. Overall sales hit 53.3 trillion Korean won (US $45.6 billion) in the quarter, with earnings of 7.1 trillion won ($6.1 billion), said the company's Tuesday earnings release. In mobile, operating profit grew to 2.5 trillion won ($2.1 billion) on sales of core smartphone products, while the S7 and S7 edge sales grew “slightly,” it said. Samsung predicts a slowdown in the smartphone market for 2017, “but new services such as AI [artificial intelligence] will become a new opportunity for differentiation,” it said. TV unit sales grew in the quarter, but earnings fell year on year due to increased panel prices, said the company. Sales of Samsung’s premium SUHD TVs jumped 36 percent vs. Q4 2015, curved TV models were up 60 percent and 60-inch and larger models shot up by 56 percent, the company said. In 2017 Samsung will push differentiated and “innovative products” it launched at CES (see Ref:1701040074]) including its quantum dot QLED TVs, one-cable connector design and no-gap wall mount. In Q1, shipments “may decrease” due to higher TV prices resulting from higher panel costs, it said.