J
Jared Peters
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Samsung has been struggling to stay competitive in the smartphone market this past year, but thanks to the component division of the company, they beat analyst expectations for 4th quarter profits in 2014. Their operating profit took a 37% dive from the year earlier, however.On the high end, Samsung competes with Apple’s premium iPhones, and on the budget side of things the company is dealing with competition from OEMs like Xiaomi that sell devices at razor thin margins. Samsung has had a hard time adapting to that kind of competition, and the company’s stocks and revenue have fallen accordingly. The company does have an ace in the hole, though, and that comes from its component business.
Not only does Samsung make mobile phones (and tons and tons of other consumer electronics) but they also manufacturer memory chips, processors, and other things that rivals like Apple use in their own devices. That’s not to say that the profits from their component division could completely support a company of Samsung’s size, but it does help that whenever other manufacturers sell more phone, Samsung makes a profit on that, too.
Samsung didn’t disclose exact numbers, but they likely will later this month. Analysts expect that their component division grew about 35% year-over-year, while the mobile division saw a serious decline.
source: Bloomberg
Come comment on this article: Samsung beats quarterly profit expectations thanks to component division
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