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Samsung profits drop slightly, but it's still seeing increased demand for phones, tablets

Richard Lawler, @Rjcc
January 23, 2014
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Samsung has released a detailed report of its earnings for the fourth quarter, and as it predicted, its operating profit is slightly lower than last year. While 8.3 trillion won (about $7.8 billion) is nothing to sneeze at, last year Samsung notched 8.84 trillion won ($8.27 billion) in operating profit, creating concerns growth is slowing in its highly successful tablet and phone business. According to Samsung however, buyers want its phones and tablets more than ever (tablet sales doubled from last year), however marketing costs and "year-end inventory adjustments" lowered shipments and cut into profits. According to Yonhap News and Reuters an $745 million one-off special bonus payment to employees celebrating the 20th anniversary of its "New Management Initiative" also had an effect, while a stronger Korean won cut 700 billion won from profits.

Details about the Galaxy Gear weren't broken out (it did get a mention on the call, as Samsung stated once again that more wearables are on the way), but we did see the first mention of OLED and Ultra HD TVs. Reflecting its CES focus on Ultra HD, Samsung says the customer base for high-res displays is increasing, with increased sales and a new manufacturing plant in operation. OLED earnings dropped an unspecified amount due to lower shipments, even though new product sales actually increased. Prices for standard LCDs continued to fall, but demand for extra large 60-inch+ HDTVs and smart TVs are both way up. We're listening in on the company's earnings call right now, we'll let you know if it drops any Galaxy S 5-sized tidbits amongst the boring money discussions.

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