Friday, July 15, 2005

Samsung's profit fell

Samsung Electronics declared on Friday that its second-quarter net profit fell by nearly half from a year earlier. The leading brand in computer hardware segment blamed this on the falling prices of computer memory chips due to which it became harder to squeeze profit from its two other main products, flat-panel screens and mobile phones. The company is the world's top manufacturer of memory chips and flat screens. It is also the world's No. 3 maker of cellphones, after Nokia and Motorola But before the quarter ended, signs emerged for a turnaround for the brand in the second half as the prices of computer memory chips were stabilizing, and demand for mobile phones, flat-panel screens for TV sets and computers and memory chips for digital music players and mobile phone handsets were on the rise in the Indian as well as international market. By revenue, Samsung's cellphone business is its largest operation, generating one-third of its 13.6 trillion won, or $13 billion, in sales in the latest quarter, as well as one-third of the company's quarterly net profit of 1.69 trillion won. The net profit for the second quarter was a 46 percent decline from the 3.13 trillion won Samsung earned a year earlier but a slight improvement over its 1.5 trillion won in the first quarter. The sales figure represents a 9.3 percent decrease from a year earlier.