Its estimated fourth quarter earnings are now three trillion Korean won ($2.7 billion), a drop of 12.8 percent from its previous estimate of 3.44 trillion won ($3 billion) for the period last year. This is also a big drop from analyst predictions, which also saw the company taking in, on average, 10 percent more.
2010’s fourth quarter results will therefore be considerably worse than 2009’s, where Samsung saw operating profits of 3.70 trillion won ($3.3 billion), which was a similar 12.5 percent decrease on the third quarter of 2009, suggesting that Samsung consistently struggles with the fourth quarter.
This makes earnings for October to December of 2010 a massive 38.3 percent lower than the previous three months and the lowest quarter Samsung experienced in all of 2010, despite the fourth quarter traditionally being the strongest for LCD sales.
The lower revised results are blamed on on poor performance of the memory sector, where Samsung has big DRAM business, but also worse-than-expected sales of LCD TVs, including 3D TV, which did not take off as well as many expected, due to excessively high prices.
The fourth quarter fall would have been even worse were it not for Samsung’s burgeoning mobile phone business, which includes the recently released Nexus S, Google’s flagship sequel to the Nexus One. It also sold 10 million Galaxy S phones and launched a strong contender to the iPad, in both power and price, the Galaxy Tab.
Samsung said it will return to increased profits this year and will release its full fourth quarter earnings at the end of the month.