Samsung Electronics announced its operating results for the fourth quarter and full year of 2024.
As of December 31, 2024, consolidated revenue for the fourth quarter reached 75.8 trillion won, with operating profit of 6.5 trillion won. Full-year revenue reached 300.9 trillion won, with operating profit of 32.7 trillion won.
Compared to the previous quarter, although both revenue and profit margin declined in the fourth quarter, full-year revenue reached the second-highest level in history, second only to 2022. Operating profit decreased by 2.7 trillion won compared to the previous quarter, hampered by a sluggish IT product market and increased R&D spending.
Looking ahead to the first quarter of 2025, although the overall improvement in profitability may be limited by the weakness in the semiconductor business, Samsung will drive future growth by boosting sales, focusing on smartphones with differentiated AI experiences and high-end products from the Device Experience (DX) business group.
Looking ahead to 2025, Samsung plans to enhance its technological and product advantages in the field of AI, continue to meet the market's future demand for high-value-added products, and drive sales growth in the high-end market.
Samsung's Device Solutions (DS) business group anticipates continued market downturn in the first half of the year, and will focus on consolidating its technological leadership to achieve its medium- to long-term growth goals. Samsung Display (SDC) will strengthen its leading position in the high-end product segment by enhancing product competitiveness, while the Device Experiences (DX) business group will prioritize building its capabilities in delivering AI experiences across its diverse product portfolio.
In 2024, Samsung Electronics' total capital expenditure was 53.6 trillion won, including 46.3 trillion won allocated to the Device Solutions (DS) business group and 4.8 trillion won invested in Samsung Display (SDC). Fourth-quarter capital expenditure totaled 17.8 trillion won, with DS accounting for 16 trillion won and SDC for 1 trillion won.
The semiconductor business will optimize its portfolio with advanced nodes at its core.
The DS business group's consolidated revenue for the fourth quarter of 2024 reached 30.1 trillion won, with an operating profit of 2.9 trillion won.
The Memory Business Unit achieved record revenue in the fourth quarter, primarily driven by increased sales of high-bandwidth memory (HBM) and high-density DDR5 for servers, which boosted the combined average selling price (ASP) of DRAM. However, the business unit's operating profit declined slightly compared to the previous quarter, mainly due to increased R&D spending to consolidate its technological leadership and initial costs incurred to secure advanced process capacity.
Looking ahead to the first quarter of 2025, amid demand uncertainty, the Memory Business Unit will accelerate its migration toward advanced nodes and incorporate more high-value-added products into its portfolio to meet market demand for high-performance, high-density products.
In the DRAM business, the Memory Division will accelerate its deployment towards 1b nanometer (nm) process technology to increase the shipment share of DDR5 and LPPDR5x. On the NAND side, the business is accelerating its technology migration from V6 to V8, while also boosting sales of V7 QLC server SSDs.
Overall memory market demand is projected to begin recovering in the second quarter of 2025. The Memory Business Unit is gradually reducing the proportion of traditional DRAM and NAND products to adapt to changing market demand and accelerate its migration to advanced nodes. The unit will increase the proportion of high-value-added products, such as HBM, DDR5, LPDDR5x, GDDR7, and server SSDs based on advanced process nodes, to further strengthen its business competitiveness and optimize its product portfolio.
System LSI's profits declined this quarter, hampered by weak demand for mobile devices and rising R&D costs for upgrading advanced products.
Due to its late entry into the flagship system-on-a-chip (SoC) market, profit performance is expected to remain weak in the first quarter of 2025. However, the release of flagship smartphones is expected to drive demand for core products such as image sensors and digital display components (DDIs).
Looking ahead to 2025, the System LSI business unit will focus on product optimization, further enhancing its flagship SoCs. In terms of image sensors, the unit will actively respond to high-resolution demands, such as 200-megapixel telephoto and main lenses.
The foundry business unit experienced an overall decline in profitability due to reduced capacity utilization and increased R&D costs for advanced node technologies. The unit is actively developing 2nm GAA technology, and its design kits (DKs) are already available to customers for product design. Currently, it is using 4nm processes to mass-produce HPC products with stable yields.
In the first quarter of 2025, weak demand in the mobile device market, coupled with low capacity utilization, will lead to increased fixed costs and continued weak profitability. Against this backdrop, the foundry business will focus on driving advanced process development and improving process maturity to expand opportunities in AI and HPC applications, as well as customer engagement at advanced nodes.
Looking ahead to 2025, the business unit will secure major customer orders by increasing and stabilizing 2nm GAA technology production capacity, while strengthening 4nm technology and design infrastructure to meet the growing mobile and HPC needs.
The panel business aims to enhance product competitiveness by 2025.
SDC's consolidated revenue for the fourth quarter reached 8.1 trillion won, with an operating profit of 0.9 trillion won.
SDC's profitability was lower than the previous quarter due to sluggish demand for smartphones and intensified competition in the mobile device panel business. However, thanks to increased TV sales at the end of the year, the revenue of its large panel business achieved double-digit quarter-on-quarter growth.
Looking ahead to the first quarter of 2025, overall smartphone market demand is expected to continue to slow, and the mobile device panel business has a conservative outlook on profitability. In the large-format panel business, SDC plans to launch televisions with enhanced picture quality and high-resolution displays.
Looking ahead to 2025, SDC will solidify its leading position in the high-end market by strengthening its product competitiveness. In the large-panel business, SDC will boost sales of various high-performance TVs and monitors.
MX is strengthening its leading position in the mobile AI field by focusing on flagship products. The combined revenue of MX Mobile Communications and the Networks division reached 25.8 trillion won in the fourth quarter, with an operating profit of 2.1 trillion won.
The MX division saw a decline in both revenue and profit, partly due to the cooling effect of the new flagship phones. However, looking at the whole year, the Galaxy S24 flagship series achieved double-digit growth thanks to its Galaxy AI, injecting strong growth momentum into the flagship phone business. Sales revenue and shipments of tablets and wearables also grew in tandem.
In the first quarter of 2025, the MX business unit plans to focus on flagship models, especially the newly launched Galaxy S25 flagship series, to drive sales growth and continue to lead the AI smartphone market by promoting new AI experiences and product competitive advantages.
Looking ahead to 2025, the MX division will offer even more personalized and differentiated AI experiences, solidifying its leading position in the mobile AI field, while strengthening its foldable product lineup to stimulate new customer demand. Furthermore, to expand sales, the division plans to integrate advanced AI features and a rich Galaxy ecosystem experience into its high-end tablets, laptops, wearables, and upcoming XR devices.
Due to leaps in hardware specifications, prices of major components are expected to rise this year, but the MX division will continue to expand the application of Galaxy AI and use flagship products as the main sales driver to improve profitability.
Looking back at the fourth quarter, the Networking Business Unit saw significant growth in both revenue and operating profit in key markets. Looking ahead to 2025, the business unit is expected to win new orders, and profitability will improve as major telecom operators expand their network deployments and increase the adoption of virtualized and open radio access networks (vRAN/ORAN).
Vision AI is expected to inject growth momentum into the Imaging Display Business Unit . The combined revenue of the Imaging Display (VD) and Digital Appliances (DA) businesses reached 14.4 trillion won in the fourth quarter, with an operating profit of 0.2 trillion won.
The VD business saw revenue growth in the fourth quarter thanks to expanded sales and an optimized sales mix resulting from peak season promotions, but profitability declined slightly due to a significant contraction in television demand and increased costs caused by intensified competition.
Looking ahead to the first quarter of 2025, while increased economic uncertainty in South Korea and globally is expected to lead to a decline in overall TV demand compared to the same period last year, market demand for high-value-added products is expected to remain stable. Guided by Samsung's Vision AI strategy for AI displays, the division will strive to improve profitability and expand sales of strategic products by launching new models.
Looking ahead to 2025, overall TV demand is expected to grow slightly in key emerging markets. Under Samsung's "Home AI" vision, the VD division plans to lead the future development of the AI screen market, integrating AI into all connected device experiences based on the SmartThings platform and expanding the application of Samsung Knox security solutions.
