Samsung Electronics said on Thursday that, for the entire year of 2020, it has posted 236.81 trillion won in sales and 35.99 trillion won in operating profit.
This is a rise of 2.78% and 29.62%, respectively, from 2019.
The figure matches the market consensus of South Korean analysts of sales of 235.76 trillion won and operating income of 36.05 trillion won.
In the fourth quarter, Samsung reported 61.55 trillion won in sales and 9.05 trillion won in operating income, a rise of 2.78% and 26.35%, respectively, from the same time period in 2019.
The company’s operating margin rate for the quarter was 14.7%.
However, unfavorable exchange rate caused 1.4 trillion won of negative effect on the fourth quarter compared to the previous quarter, Samsung said.
Demand for memory in mobile and consumer applications were solid in the fourth quarter, the company said, but average sales price continued to drop and spending to ramp up new production lines caused profitability to drop. The system semiconductor business saw orders from global customers increase.
Display panel saw high increase in demand for small- to mid-sized panel and recovery in the market for large-sized panel, allowing the business to improve profits from a year prior as well as the previous quarter.
The mobile business saw intensifying competition and increase in marketing fees in the fourth quarter, but cost saving measures maintained its double digit operating margin rate, Samsung said.
The network business saw expanded sales from 4G and 5G kit in South Korea and abroad. The consumer electronics business saw recovered sales in developed markets but increase in cost slowed down profitability.
Samsung expects the mobile business to post strong profits in the first quarter from the early launch of the Galaxy S21 series but component businesses such as memory and display will slow growth, leading to an overall decline in profitability in that quarter.
Memory product, while enjoying demand from recovery in mobile and data centers, will see profit decline in the first quarter from a weak Korean won, the company said.
System LSI will expand supply of system-on-a-chip (SoC) and CMOS image sensors and driver ICs for flagship smartphones in the first quarter. Foundry will expand production of 5nm EUV SoC and 8nm high performance computing chips.
The display panel business will see profit improve on the back of expanded OLED shipment for phones. The business will continue its transition in large panels to quantum displays.
For 2021, Samsung expects recovery in demand globally, while uncertainties over resurgence of COVID-19 lingers. Memory business is expected to recover to from by the first half of 2021. It will transition to 1z nm DRAM and Gen 6 V-NAND quickly and expand the application of EUV. System LSI will launch differentiated product in 5G SoC and high-resolution image sensors. Foundry will expand the production of EUV 5nm chips.
The mobile business will focus on strengthening its premium line-up from the Galaxy S21 to foldable smartphones whiling also expanding 5G line-up to mid-tier smartphones. Consumer Electronics will focus on online sales and efficient marketing.
Samsung spent 38.5 trillion won in capital expenditure last year. Semiconductor accounted for 32.9 trillion won and display 3.9 trillion won of that.