Samsung Electronics has published its Q4 2022 earnings guidance and preliminary numbers are not looking good. The Korean phone maker’s October-December quarter consolidated operating profit estimate was $3.38 billion. This is 69% lower than Q4 2021 and the company’s lowest operating profit since 2014.
The quarterly revenue estimates have fallen by 9% to $55 billion. Samsung’s financial problems are mainly due to a decrease in demand for memory chips and smartphones. Analysts expect dwindling profits in the Q1 2023 period, due to the same factors as this quarter’s slumps.
Samsung’s upcoming Galaxy S23 series of phones may be able to offset these unfavorable numbers in the next few quarters. The Galaxy S series is not as popular as the A family of phones, but it still brings significant revenue due to its high price pool. These phones are also widely available around the globe due to Samsung’s reach in the international market.
The next generation of Z series foldables is also expected to break cover later this year. This should include the Galaxy Z Fold 5 and Z Flip 5. The Galaxy Z Flip series has been doing well thanks to its more competitive price tag and familiar design compared to the Z Fold 4. These phones sold millions around the globe last year as well as in 2021.
However, even these sales may not be enough to turn things around amid the global economic downturn. This has forced several companies to cut off thousands of employees and turn to other cost-saving strategies. Samsung Galaxy S23 phones reportedly lack vapor chambers for heat dissipation and many are speculating that this is simply a cost-saving move. We’ll know more in the next month or so.
