Samsung Q1 2023 earnings highlight 'successful' Galaxy S23 sales amid massive drop in profit
The second half of the year could be better.
What you need to know
- Samsung has reported its Q1 2023 earnings in full.
- The company earned 63.75 trillion KRW in consolidated revenue but only 640 billion Korean won in operating profit.
- The Galaxy S23 series, specifically the Galaxy S23 Ultra, performed quite well in the introductory quarter.
- While Q2 2023 may continue to be slow for the Korean OEM, it's hopeful the second half of the year will be better overall.
As we close out the stormy month of April, Samsung is revealing how it faired at the top of the year. Earlier this month, Samsung posted its earnings guidance for the previous quarter. The Korean OEM has now published its full Q1 2023 earnings report, which mirrors much of what its guidance alluded to. Samsung states the company posted 63.75 trillion KRW ($45.57 million USD) in consolidated revenue, a 10% decline from Q4 2022 but a nearly 20% drop from the same time last year.
The company's operating profit was cause for concern in its guidance report and continues to be so in its earnings report. Samsung reports an operating profit of only 640 billion Korean won ($477 million USD), a near 95% freefall from Q1 2022, citing a decrease in demand for its DS (Device Solutions) Division.
The Korean OEM has grappled with a lowered demand for semiconductors — much like Qualcomm. Samsung's business in producing high-quality memory for PCs has dropped "significantly compared to the previous quarter" due to inventory adjustments by the company and the economic downturn. Samsung remains hopeful that its memory business will pick up in the second half of the year as new CPUs and increased demand for AI generate momentum.
Outside of hope and downturns, the MX and Network businesses generated 31.82 trillion KRW in consolidated revenue and 3.94 trillion KRW in operating profit for Q1 2023. Samsung reported its positive Q1 performance, which could be attributed to the launch of the Galaxy S23 series — specifically, the Galaxy S23 Ultra. Furthermore, a preliminary report from Canalys also showed that Samsung took the top spot in Q1 for smartphone shipments, just outperforming Apple.
The MX business is prepping to unveil its next wave of foldable phones (the Galaxy Z Flip 5 and Z Fold 5) as the Korean OEM looks to drive home its "leadership in the category." Samsung's budget phones, the Galaxy A54 and Galaxy A34 series, will be in the spotlight as the company looks to recover some market demand as those products have gained some new improvements.
Samsung says it will "strengthen the competitiveness of its tablets and wearables" and play up the experience consumers can garner from those devices. We can likely expect to see what the company has in store later this year when it's expected to launch the Galaxy Watch 6 and Galaxy Tab S9. Samsung's Network business hopes to gain an increase in revenue by expanding its overseas markets and improving its position with 5G core chips.
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Nickolas is always excited about tech and getting his hands on it. Writing for him can vary from delivering the latest tech story to scribbling in his journal. When Nickolas isn't hitting a story, he's often grinding away at a game or chilling with a book in his hand.