Samsung smartphone profit dips in Q4 2020; bets on foldable and 5G phones for 2021 growth

Highlights
  • Samsung has posted its Q4 2020 and FY 2020 results
  • Its smartphone division saw a decline in profit due to sub-par sales
  • Samsung plans on remedying that by launching more affordable 5G smartphones, tablets, and wearables this year

Samsung has posted its FY 2020 results alongside the Q4 2020 numbers. Compared to Q3 2020, the company saw a 26.4 percent rise in profits but revenues were down. Although its smartphone division was overtaken by Apple in Q4 2020, Samsung managed to make that deficiency up in other sectors such as memory and display manufacturing. Samsung’s consolidated revenue was KRW 61.55 trillion (approx Rs 40,19,39,09,25,000) and operating profit was KRW 9.05 trillion (approx 5,91,47,13,47,500.00) during Q4 2020. For the entirety of 2020, Samsung’s total revenue was KRW 236.81 trillion (approx Rs 1,54,75,91,88,44,336), with an operating profit of KRW 35.99 trillion (approx Rs 23,52,36,39,84,000).

Also read: Record iPhone 12 sales propel Apple to top spot in global smartphone market in Q4 2020: Counterpoint 

Samsung’s smartphone department generated KRW 22.34 trillion (approx Rs 14,60,00,13,88,803) revenue in Q4 2020 and made a profit of 2.42 trillion (approx Rs 1,58,16,02,55,041) on it. It posted a decline in profit compared to last quarter, primarily due to weaker sales and higher marketing spending.

Samsung is optimistic that things will get better in Q1 2021, as it anticipates the Galaxy S21 series to sell well. The company has also confirmed that it plans on launching several affordable 5G smartphones in 2021 to help bolster sales. There is also a tacit admission about new Galaxy Z Fold and Galaxy Z Flip variants being in the works. Samsung’s mobile division also plans on expanding its portfolio further by focusing more on tablets and wearables. 

Until now, Samsung was content developing chipsets for its in-house smartphones. However, things have changed with the Exynos 1080 making its debut alongside the Vivo X60 series. Samsung is banking on orders from OEMs such as Xiaomi, OPPO, and Realme to establish its presence in the mobile SoC market. Samsung has cautioned that there could be some chipset shortages in Q1 2020 due to high demand. We could even see some new Exynos chips make their debut in 2020, as the company has finalised plans for its second generation of 5nm chipsets and even a 4nm process.