• Consolidated Sales: Approximately 133 trillion Korean won
• Consolidated Operating Profit: Approximately 57.2 trillion Korean won

The above estimates are based on K-IFRS. Please note that Korean disclosure regulations do not allow earnings estimates to be offered as a range. To comply with such regulations, the above figures represent the median of the estimate ranges provided below.

• Sales: 132 trillion to 134 trillion Korean won
• Operating Profit: 57.1 trillion to 57.3 trillion Korean won

2025 4Q and 2025 1Q consolidated figures based on K-IFRS are as follows

• Consolidated Sales: Approximately 93 trillion Korean won
• Consolidated Operating Profit: Approximately 20 trillion Korean won

The above estimates are based on K-IFRS. Please note that Korean disclosure regulations do not allow earnings estimates to be offered as a range. To comply with such regulations, the above figures represent the median of the estimate ranges provided below.

• Sales: 92 trillion to 94 trillion Korean won
• Operating Profit: 19.9 trillion to 20.1 trillion Korean won

※  2025 3Q and 2024 4Q consolidated figures based on K-IFRS are as follows

The Company posted KRW 74.6 trillion in consolidated revenue, a decrease of 5.8% compared to the previous quarter. Operating profit decreased to KRW 4.7 trillion.

The Device Solutions (DS) Division reported an increase in revenue on the back of expanded sales of high density, high-performance memory products, but inventory value adjustments in memory and one-off costs related to the impacts of export restrictions related to China in non-memory had an adverse effect on profit. In the Device eXperience (DX) Division, operating profit declined quarter-on-quarter due to a sequential decline in sales volume following the launch of new smartphone models in the first quarter.

Looking ahead to H2, the DS Division plans to proactively meet the growing demand for high-value-added and AI-driven products and continue to strengthen competitiveness in advanced semiconductors. The DX Division will seek to minimize the impact of uncertainties stemming from tariff policies that are likely to persist.

Semiconductors Expected To Proactively Meet Continued AI Demand

The DS Division posted KRW 27.9 trillion in consolidated revenue and KRW 0.4 trillion in operating profit for the second quarter.

In Q2 2025, the Memory Business proactively addressed robust server demand by expanding HBM3E sales and by expanding the proportion of high-density DDR5 products. Also, with the resumption of datacenter projects that were previously delayed, sales of server SSDs increased, helping NAND inventory to decrease significantly. However, earnings were impacted by one-off costs such as inventory value adjustments.

In H2 2025, AI demand is expected to remain robust due to continued investments by major cloud service providers, and therefore server demand for both DRAM and NAND is expected to stay strong.

To align with solid AI-server demand for DRAM, the Memory Business will proactively address the need for high-density products and diversify product offerings through HBM, server LPDDR5x, high-density DDR5, 24Gb GDDR7 and other products. For NAND, the Memory Business plans to increase sales of high-density and high-performance SSDs while accelerating the transition to 8^th Generation V-NAND across all applications.

The System LSI Business generated solid revenue from shipments of flagship systems-on-a-chip (SoCs) using the Gate-All-Around (GAA) process, but earnings improvement was limited due to higher costs of developing advanced products.

In H2 2025, the System LSI Business will focus on improving Exynos competitiveness to ensure its adoption in 2026 flagship mobile lineups of a major customer and expanding the sales of ultra-high-resolution and nano-prism sensors.

Despite significant growth in revenue from the first quarter, earnings for the Foundry Business remained weak due to the impact of inventory value adjustments that stemmed from US export restrictions on advanced AI chips to China, as well as a continued low utilization rates at mature nodes.

In H2 2025, the Foundry Business will ramp up mass production of a new mobile SoC with the 2nm GAA process. It also aims to improve factory utilization and profitability through expanded sales to major customers.

SDC To Further Accelerate Leadership By Differentiating and Enhancing Display Technologies

Samsung Display Corporation (SDC) posted KRW 6.4 trillion in consolidated revenue and KRW 0.5 trillion in operating profit for the second quarter.

For the mobile display business, SDC saw a revenue increase based on the response to new smartphones of major customers as well as the expansion of sales in the IT and automotive segments. The large display business experienced continued growth in sales of QD-OLED monitor displays, driven by robust demand in the gaming market.

In H2 2025, the mobile display business expects sales growth from major customers’ new smartphone launches amid ongoing market uncertainties. It also aims to strengthen market leadership with differentiated technologies and the continued expansion of sales beyond smartphone displays. The large display business will seek to maintain a stable supply of TV panels while continuing to accelerate the penetration of QD-OLED monitors by enhancing the product lineup.

MX Grows Revenue and Operating Profit YoY, Will Focus on Flagship Sales and AI Capabilities

The Mobile eXperience (MX) and Networks businesses posted KRW 29.2 trillion in consolidated revenue and KRW 3.1 trillion in operating profit for the second quarter.

In Q2 2025, the MX Business experienced a decrease in smartphone shipments compared to Q1, when new models were released, but both revenue and operating profit grew YoY through robust sales of the Galaxy S25 series, Galaxy A series and Galaxy tablets. The Business also maintained solid double-digit profitability via efficient resource management.

In H2 2025, the MX Business plans to continue a flagship-first approach for smartphone sales focusing on foldables and the Galaxy S25 series — while emphasizing the AI functionality of the Galaxy A series — to increase market share. It will also reinforce the AI capabilities of tablets and wearables and expand the Galaxy ecosystem with the launch of products with new form-factors, including extended reality (XR) and TriFold devices, and contribute to maintaining solid profitability despite market uncertainties and rising bill of materials (BOM) costs.

The Networks Business improved profitability in Q2 2025 by expanding revenue in overseas markets and enhancing cost efficiencies, and in H2 2025, it will focus on achieving revenue targets and regaining competitiveness by securing new orders with optimized costs.

Visual Display Enhances Sales Mix, Targets the Capture of Peak-Season Demand in H2

The Visual Display and Digital Appliances businesses posted KRW 14.1 trillion in consolidated revenue and KRW 0.2 trillion in operating profit in the second quarter.

In Q2 2025, the Visual Display Business improved the sales of premium products, such as Neo QLED and OLED TVs, but earnings declined due to stagnant demand and intensified competition.

In H2 2025, the Business plans to reinforce revenue growth by capturing peak-season demand, based on a strengthened lineup of high-value-added TVs offering superior viewing experiences with enhanced AI features. In addition, the Business will drive solid profitability and growth through its differentiated experiences and services including SmartThings, Samsung Knox, Samsung Art Store and Samsung TV Plus.

The Company posted KRW 79.14 trillion in consolidated revenue, an all-time quarterly high, on the back of strong sales of flagship Galaxy S25 smartphones and high-value-added products. Operating profit increased to KRW 6.7 trillion despite headwinds for the DS Division, which experienced a decrease in quarterly revenue.

The Company has allocated its highest-ever annual R&D expenditure for 2024, and in the first quarter of this year, it has also increased its R&D expenditure by 16% compared to the same period last year, amounting to 9 trillion won.

Despite the growing macroeconomic uncertainties due to recent global trade tensions and slowing global economic growth, making it difficult to predict future performance, the Company will continue to make various efforts to secure growth. Additionally, assuming that the uncertainties are diminished, it expects its performance to improve in the second half of the year.

Semiconductors Projected To Continue Growth by Meeting Evolving AI Needs

The DS Division posted KRW 25.1 trillion in consolidated revenue and KRW 1.1 trillion in operating profit for the first quarter.

For the Memory Business, revenue was driven by expanded server DRAM sales and the addressing of additional NAND demand amid a perceived bottoming out of the market price.

However, overall earnings were impacted by the erosion of average selling price (ASP), as well as a decrease in HBM sales due to export controls on AI chips and deferred demand in anticipation of upcoming enhanced HBM3E products.

In Q2 2025, the Memory Business anticipates robust demand for AI servers and will therefore seek to strengthen our position in the high-value-added market via our server-centric portfolio, along with a ramp-up of the enhanced HBM3E 12H to meet initial demand. For NAND, the Memory Business seeks to enhance cost competitiveness by accelerating the transition to 8^th Generation V-NAND for all applications.

In H2 2025, AI-related demand is expected to remain high in conjunction with the launch of new GPUs. Therefore, the Memory Business will expand the sales of high-value-added products, including enhanced HBM3E 12H products and high density DDR5 modules of 128GB or higher.

In the mobile and PC markets, on-device AI is expected to proliferate, so the Memory Business will proactively respond to this shift in the business environment with its industry-leading 10.7Gbps LPDDR5x products.

Earnings at the System LSI Business improved modestly, due to an increased supply of high-resolution sensors and LSI products. This improvement came despite a sluggish smartphone market and the delayed adoption of the Company’s flagship system-on-a-chip (SoC).

In Q2 2025, the System LSI Business will maintain steady revenue by gaining SoC adoption by a major customer for new flagship models and capitalizing on the growing adoption of 200-megapixel sensors.

In H2 2025, the System LSI Business will expand its flagship SoC supply, proactively address demand for high-resolution main and telephoto camera sensors and expand its automotive sensor portfolio.

Earnings for the Foundry Business were muted due to sluggish seasonal mobile demand, inventory adjustments and stagnant fab utilization. However, the Business focused on the 2nm Gate-All-Around (GAA) process, improving yields and stabilizing the line while keeping the program on schedule, while also securing additional sub-5nm orders, specifically the 2nm and 4nm nodes for AI and HPC applications.

In Q2 2025, the Business will stabilize its 2nm process production and drive earnings improvement by actively addressing strong mobile and automotive demand in the United States. Looking ahead to H2 2025, the Foundry Business aims to start 2nm mass production and secure major 2nm orders and strengthen its specialty process portfolio on mature nodes.

SDC Aims To Navigate Challenges and Drive Growth With Differentiated Offerings

Samsung Display Corporation (SDC) posted KRW 5.9 trillion in consolidated revenue and KRW 0.5 trillion in operating profit for the first quarter.

For the mobile display business, SDC reported declining profits QoQ due to seasonality. The results of the large display business have improved via the launch of new QD-OLED monitor products for major clients.

In Q2 2025, the mobile display business maintains a conservative outlook on earnings while pursuing the stable supply of new products such as foldables. For the large display business, demand for gaming monitors is expected to grow due to the upcoming launches of new products.

In H2 2025, SDC aims to grow the mobile display business sales through differentiated technologies and products amid rising market uncertainties. For the large display business, SDC will strengthen its presence in both B2C and B2B monitor markets with diverse product lineups.

MX Achieves Revenue Growth, Continues To Expand AI Capabilities

The MX and Networks businesses posted KRW 37 trillion in consolidated revenue and KRW 4.3 trillion in operating profit for the first quarter.

The MX Business experienced QoQ growth in both revenue and operating profit thanks to the strong sales of its Galaxy S25 series, which features an advanced Galaxy AI experience. Enhanced cost competency and price declines for some components also contributed to solid double-digit profitability.

In Q2 2025, the MX Business plans to sustain flagship-centric sales amid weak seasonality by successfully launching the Galaxy S25 Edge. It will also expand its AI smartphone lineup through the introduction of “Awesome Intelligence” to the Galaxy A series.

In H2 2025, the MX Business will strengthen its foldable lineup by offering a differentiated AI user experience. In addition, the Business will launch new ecosystem products with enhanced AI and health capabilities, and explore new product segments such as XR.

Visual Display Posts Solid Performance, Strengthens Advanced AI Features

The Visual Display and Digital Appliances businesses posted KRW 14.5 trillion in consolidated revenue and KRW 0.3 trillion in operating profit in the first quarter.

The Visual Display Business recorded solid sales of strategic products such as Neo QLEDs, OLEDs, and large models of 75 inches and over, while price increases and material cost reductions resulted in improved QoQ profitability.

In Q2 2025, the Business intends to expand TV sales with its 2025 AI TV lineup and the integration of advanced AI functions.

In H2 2025, the Business will focus on capturing peak season demand by strategic collaboration with distributors, based on an enhanced AI TV lineup.

The Company posted KRW 75.8 trillion in consolidated revenue and KRW 6.5 trillion in operating profit in the quarter ended December 31, 2024. For the full year, it reported KRW 300.9 trillion in annual revenue and KRW 32.7 trillion in operating profit.

Although fourth quarter revenue and operating profit decreased on a quarter-on-quarter (QoQ) basis, annual revenue reached the second-highest on record, surpassed only in 2022. Meanwhile, operating profit was down KRW 2.7 trillion QoQ, due to soft market conditions especially for IT products, and an increase in expenditures including R&D.

In the first quarter of 2025, while overall earnings improvement may be limited due to weakness in the semiconductors business, the Company aims to pursue growth through increased sales of smartphones with differentiated AI experiences, as well as premium products in the Device eXperience (DX) Division.

For 2025 as a whole, the Company plans to enhance technological and product advantages in AI, continue to meet future demand for high-value-added products and drive sales growth in premium segments.

With market conditions expected to remain soft in 1H for the Device Solutions (DS) Division, the Company will focus on securing technology leadership for mid- to long-term growth. Samsung Display Corporation (SDC) will look to strengthen its leading position in high-end products by enhancing product competitiveness, and the DX Division will focus on extending its leadership in delivering AI experiences across a diverse product portfolio.

The Company’s capital expenditures in 2024 reached a total of KRW 53.6 trillion, including KRW 46.3 trillion spent in the DS Division and KRW 4.8 trillion in SDC. In the fourth quarter, the total was KRW 17.8 trillion, with KRW 16 trillion allocated to the DS Division and KRW 1 trillion to SDC.

Semiconductors To Optimize Portfolio Centered on Advanced Nodes

The DS Division posted KRW 30.1 trillion in consolidated revenue and KRW 2.9 trillion in operating profit in the fourth quarter of 2024.

The Memory Business achieved record-high fourth-quarter revenue, backed by a higher blended DRAM average selling price (ASP) due to the increased sales of high-bandwidth memory (HBM) and high-density DDR5 for servers. However, operating profit decreased slightly compared to the previous quarter as a result of increased R&D expenses to secure future technology leadership, as well as the initial ramp-up costs to secure production capacity for cutting-edge nodes.

In the first quarter of 2025, amid ongoing uncertainties in demand, the Memory Business will shift its business portfolio to more high-value-added products by accelerating the migration to cutting-edge nodes to respond to the demand for high-performance and high-density products.

For DRAM, the Memory Business seeks to increase the share of DDR5 and LPPDR5x shipments by accelerating the transition to the 1b nanometer (nm) process. As for NAND, the Business is executing the technology migration from V6 to V8 while increasing sales of V7 QLC-based server SSDs.

In 2025, overall memory market demand is expected to recover from the second quarter. The Memory Business is reducing the portion of legacy DRAM and NAND products to align with market demand and accelerating the migration to cutting-edge nodes. The Business will continue to strengthen its business competitiveness and optimize its portfolio by increasing the portion of high value-added products such as HBM, DDR5, LPDDR5x, GDDR7 and server SSDs based on advanced process nodes.

Earnings at the System LSI Business declined in the quarter due to weak mobile demand and higher R&D expenses to advance cutting-edge product development.

In the first quarter of 2025, earnings are expected to remain weak due to delayed entry into the flagship system-on-a-chip (SoC) market. However, demand for core products such as image sensors and DDI is expected to increase on the back of flagship smartphone launches.

In 2025, the System LSI Business will focus on further enhancing its flagship SoC through product optimization. For image sensors, the Business will proactively respond to high-resolution needs — such as for 200-megapixel (MP) telephoto and main cameras.

The overall profit for the Foundry Business decreased due to lower utilization rates and higher R&D expenses for advanced-node technology. Its 2nm GAA technology is under active development, with the design-kit (DK) already distributed to customers for product design, while the 4nm process is mass producing HPC products based on stable yields.

Looking ahead to the first quarter of 2025, earnings are expected to remain weak due to sluggish mobile demand and fixed-cost burden stemming from lower utilization rates. In this environment, the Foundry Business will concentrate on advancing leading-edge process development and enhancing process maturity to expand opportunities in AI and HPC applications and customer engagement for advanced nodes.

As for 2025, the Business will continue to secure orders from major customers by ramping up and stabilizing the 2nm GAA technology, while simultaneously bolstering the 4nm technology and design infrastructure to meet the growing mobile and HPC needs.

Display To Strengthen Product Competitiveness in 2025

SDC posted KRW 8.1 trillion in consolidated revenue and KRW 0.9 trillion in operating profit for the fourth quarter.

SDC reported declining profits QoQ due to sluggish smartphone demand and rising competition for the mobile display business, and achieved double-digit revenue growth QoQ for the large display business, with an increase in year-end TV sales.

In the first quarter of 2025, the earnings outlook for the mobile display business is conservative, as the overall smartphone market demand is expected to remain weak. For the large display business, TVs with enhanced image quality are scheduled to launch, as well as high-resolution monitors.

In 2025, SDC aims to sustain its leadership in the high-end segment by strengthening product competitiveness. For the large display business, SDC will increase sales of diversified high-performance TVs and monitors.

MX To Drive Flagship-Centric Sales, Reinforce Leadership in Mobile AI

The Mobile eXperience (MX) and Networks businesses posted KRW 25.8 trillion in consolidated revenue and KRW 2.1 trillion in operating profit for the fourth quarter.

The MX Business reported a QoQ decrease in sales and profit, in part due to the fading effects of new flagship model launches. However, on a full-year basis, flagship sales saw robust growth on the back of double-digit growth of the Galaxy S24 series featuring Galaxy AI, with tablets and wearables also increasing in both value and shipments.

In the first quarter of 2025, the MX Business plans to drive sales growth based on its flagship models, particularly the newly launched Galaxy S25 series, and will continue to lead the AI smartphone market through promotion of new AI experiences and product competitiveness.

In 2025, the MX Business will reinforce its mobile AI leadership by providing more personalized, differentiated AI experiences while also strengthening the foldable lineup to generate new customer demand. Additionally, the Business plans to expand sales by providing advanced AI features and rich Galaxy ecosystem experiences for premium tablets, notebooks, wearables and the upcoming XR device.

While prices of major components are expected to increase this year due to advancements in hardware specifications, the MX Business aims to improve profitability by continuing to build out Galaxy AI and expand sales centered on flagship products.

In the fourth quarter, the Networks Business reported significant improvements in revenue and operating profit in key markets. For 2025, performance is set to improve as the Business expects to win new orders and as major operators expand their network and increase adoption of virtualized and open radio access networks (vRAN/ORAN).

Vision AI Expected To Drive Growth for Visual Display

The Visual Display (VD) and Digital Appliances (DA) Businesses posted KRW 14.4 trillion in consolidated revenue and KRW 0.2 trillion in operating profit in the fourth quarter.

The VD Business saw revenue increase in the fourth quarter due to expanded sales and an improved sales mix through peak-season promotion, yet profitability decreased slightly as a result of increased cost from intensified competition amid largely stagnant TV demand.

In the first quarter of 2025, while overall TV demand is expected to decrease YoY due to growing domestic and global economic uncertainties, demand for high-value-added products is projected to remain solid. Business will try to improve profitability and expand strategic product sales through new model launches based on the Vision AI strategy for Samsung’s AI screens.

In 2025, the overall TV market is expected to grow slightly in major emerging markets. The VD Business plans to lead the AI screen market under Samsung’s “Home AI” vision, integrating AI into all connected device experiences based on the SmartThings platform and expand the adoption of Samsung Knox security solutions.

The Company posted KRW 79.1 trillion in consolidated revenue, an increase of 7% from the previous quarter, on the back of the launch effects of new smartphone models and increased sales of high-end memory products. Operating profit declined to KRW 9.18 trillion, largely due to one-off costs, including the provision of incentives in the Device Solutions (DS) Division.

The strength of the Korean won against the U.S. dollar resulted in a negative impact on company-wide operating profit of about KRW 0.5 trillion compared to the previous quarter.

In the fourth quarter, while memory demand for mobile and PC may encounter softness, growth in AI will keep demand at robust levels. Against this backdrop, the Company will concentrate on driving sales   of High Bandwidth Memory (HBM) and high-density products. The Foundry Business aims to increase order volumes by enhancing advanced process technologies. Samsung Display Corporation (SDC) expects the demand of flagship products from major customers to continue, while maintaining a quite conservative outlook on its performance. The Device eXperience (DX) Division will continue to focus on premium products, but sales are expected to decline slightly compared to the previous quarter.

For 2025, the Company will remain focused on enhancing competitiveness in advanced technologies and strengthening leadership in premium products and AI capabilities amid ongoing macroeconomic uncertainties. The DS Division will address demand for differentiated products based on advanced technologies and high value-added products such as HBM and server SSDs. In addition, the Company plans to leverage the mass production on the 2 nanometer (nm) Gate-All-Around (GAA) process to win new clients. SDC will aim to maintain leadership in the high-end product category and broaden its product portfolio. The DX Division will continue to deliver exceptional customer experiences through enhanced AI features and product connectivity.

With over 500 million diverse products being delivered to consumers globally every year, the Company is tailoring its AI technology in each product to help lead the market. By leveraging the SmartThings platform with 360 million users and capabilities in product intelligence, spatial intelligence, and personalization, the Company plans to firmly establish itself in the home of the future, where AI will be widespread. In the AI era for the home, the Company will focus on the security of its products, convenience in device connectivity, intelligent technology to save energy and time, and the health and well-being of users and their family.

Memory Achieves Revenue Growth in Q3

The DS Division posted KRW 29.27 trillion in consolidated revenue and KRW 3.86 trillion in operating profit in the third quarter.

For the Memory Business, demand for AI and conventional servers was strong, as major datacenter and technology companies continued to invest. But mobile demand was relatively soft due to inventory adjustments by some customers, and the supply-demand situation was impacted somewhat by the increasing supply of legacy products in the China market.

The Company focused on actively responding to the demand for AI and server products while depleting aging inventories of legacy products to further improve the inventory level and mix. Therefore, compared to the previous quarter, the Company achieved significant revenue growth in HBM, DDR5 and Server SSD.

However, performance decreased due to a reduced reversal of inventory valuation loss compared to the previous quarter, one-off expenses such as the provision of incentives, and currency effects due to a weak dollar.

For the fourth quarter, the demand trends experienced in the previous quarter are expected to continue. The Company plans to accelerate the conversion of cutting-edge nodes in legacy lines and aims to strengthen its business fundamentals by completing the normalization of the inventory level and mix by the end of the year.

For DRAM, the Company plans to expand sales in line with the increase in HBM capacity, accelerate the transition to 1b nanometer[1] for server DDR5 and actively expand the sales portion of high-density modules based on 32Gb DDR5. For NAND, the Company will expand sales of 8th generation (V8) based PCIe Gen5 and plans to mass-produce the 64TB product for the quad-level cell (QLC) market, which has high growth potential.

Looking ahead to 2025, datacenter and enterprise investments are likely to remain strong in association with AI, and build demand for conventional servers, in addition to AI servers, is expected to be steadily strong.

For DRAM, the Company plans to expand the sales of HBM3E and the portion of high-end products such as DDR5 modules with 128GB density or higher for servers and LPDDR5X for mobile, PC, servers, and so on. For NAND, the Company will proactively respond to the high-density trend based on QLC products — including 64TB and 128TB SSDs — and solidify leadership in the PCIe Gen5 market by accelerating the tech migration from V6 to V8.

The System LSI Business posted modest sales growth, but earnings declined due to increased one-off costs. System-on-chip (SoC) shipments increased as flagship products were adopted for new models by a major customer. Sales of image sensors were affected by H1’s inventory accumulation, resulting in some adjustments, while display driver IC (DDI) sales expanded with new model launches by key customers.

In the fourth quarter, supply of the Exynos 2400 will continue to expand with higher customer adoption, but weak demand for image sensors is expected to continue. For DDIs, the System LSI Business is focusing on growth areas, such as the expansion of IT-oriented OLED products.

Looking ahead to 2025, the momentum of on-device AI is expected to remain strong, and the Company will focus on capturing opportunities in areas such as SoCs and cameras. The System LSI Business plans to concentrate on supplying SoCs for flagship products of a major customer while preparing for next-generation 2nm products. Image sensors will aim to maximize new product supply through HDR, low-power and zoom features, while DDIs will seek to develop low-power products using advanced processes.

The Foundry Business saw its overall earnings decline compared to the previous quarter due to the impact of one-off costs. Still, the Foundry Business successfully met its order targets — particularly in sub-5nm technologies — and released the 2nm GAA process design kit (PDK), enabling customers to proceed with their product designs.

While mobile and PC demand may remain weak in the fourth quarter, high performance computing (HPC) and AI-related demand will continue to be robust. The Foundry Business will strive to acquire customers by improving the process maturity of its 2nm GAA technology, and it will continue to develop competitive technology and design infrastructure to expand additional business opportunities.

For 2025, the overall foundry market is expected to show double-digit growth, driven by HPC and AI applications in advanced technology nodes. The Foundry Business aims to expand revenue through ongoing yield improvements in advanced technology while securing major customers through successful 2nm mass production. In addition, integrating advanced process nodes and packaging solutions to further develop the HBM buffer die is expected to help acquire new customers in the AI and HPC sectors.

Mobile Display Records Solid Results; Will Maintain Leadership in the High-End Market

SDC posted KRW 8.0 trillion in consolidated revenue and KRW 1.51 trillion in operating profit for the third quarter.

For the mobile display business, SDC achieved sequential improvements in both sales and profits thanks to the flagship product launches of major customers. For the large display business, SDC reported a slight weakening in operating profit, but sales volume improved from the previous quarter, driven by the stable demand of TV and monitor products.

In the fourth quarter, SDC expects continued demand for flagship products from major customers, and sales growth of IT and automotive products. However, SDC’s performance outlook is quite conservative compared to the previous quarter, due to headwinds from rising competition among panel makers.

For the large display business, SDC will keep striving to expand sales by meeting the fourth quarter demand of major customers through improved production efficiency, and it aims to respond to the demand for new products in 2025 with timely supply.

In 2025, SDC will continue to maintain its leadership in the foldable and high-end smartphone markets, based on innovative OLED technologies optimized for AI devices and accelerate the expansion of IT and automotive products to further diversify its business portfolio.

For the large display business, SDC will continue to leverage the performance advantage of QD-OLED panels to strengthen its position in the premium TV market. And for monitors, SDC will broaden its lineup by adding high-resolution products and diverse refresh rate options, aiming not only to solidify its competitive edge in the gaming monitor market but also to actively enter the B2C monitor market.

MX Business To Achieve Double-Digit Annual Sales Growth in Flagships

The MX and Networks businesses posted KRW 30.52 trillion in consolidated revenue and KRW 2.82 trillion in operating profit for the third quarter.

Overall market demand for smartphones grew modestly as the residual effects of global inflation slowed the recovery in consumer spending.

The MX Business recorded sequential growth in both revenue and operating profit, bolstered by the launch of new smartphone, tablet and wearable products. Sales increased — with a focus on flagship models — and profitability neared double digits, despite rising material costs as product specifications improved to boost competitiveness.

In the fourth quarter, seasonal factors are expected to lead to sequential growth in the smartphone market. At the same time, competition in the mass market segment is expected to increase as a result of rising demand, particularly in emerging markets.

The MX Business will continue to maintain solid sales of its AI smartphones, such as foldables and the S24 series, with various sales promotions in anticipation of the holiday season, aiming for annual flagship sales growth of double digits. In addition, the MX Business will expand sales linked to year-end seasonality for tablets and wearables, especially on new premium products with significantly enhanced performance, to contribute to the MX Business’ sales and profits.

In 2025, the macroeconomic environment is expected to stabilize to a degree as a result of interest rate cuts, leading to slight growth in the smartphone market. The mass market segment is expected to grow, along with demand for ecosystem products, and the smartwatch and true wireless stereo (TWS) markets will expand with broader applications of AI capabilities.

The MX Business will drive sales growth and improve profitability with a focus on flagship products, including smartphones, foldables, tablets and wearables, based on further advancements of Galaxy AI.

Visual Display To Focus on Premium Models and Service Expansion

The Visual Display and Digital Appliances businesses posted KRW 14.14 trillion in consolidated revenue and KRW 0.53 trillion in operating profit in the third quarter.

The Visual Display Business saw improved profitability both from the previous quarter and a year earlier by prioritizing sales of strategic products such as Neo QLEDs, OLEDs, and big TVs. Additionally, service business sales increased.

In the fourth quarter, overall demand in the TV market is expected to recover due to year-end peak seasonality amid intensifying competition. The Visual Display Business plans to capture peak season demand by enhancing sales program through strategic collaborations with major retail partners, and will focus on expanding sales and securing profitability by emphasizing the competitiveness of TVs in terms of security, design, and content.

In 2025, the overall TV market is expected to post modest growth, with strategic products like QLEDs, OLEDs, and big TVs continuing to gain market share. To solidify its leading position globally, the Visual Display Business will continue to differentiate AI functionalities and innovate its products centering on premium and Lifestyle screens.

By utilizing AI, the Company aims to enhance core TV features such as picture and sound quality, while also improving the overall user experience within the SmartThings ecosystem. The Company plans to drive sales of premium products centered on Neo QLED, OLED and super big TVs, and it will maintain leadership in the Lifestyle screen category by leveraging well-established competitive advantages.

Furthermore, by capitalizing on the extensive installed base that has been established through hardware leadership, the Visual Display Business will continue to expand the service platform business through advertisement and media such as Samsung TV Plus.

[1] Refers to Samsung’s fifth-generation 10nm class DRAM.

The Company posted KRW 74.07 trillion in consolidated revenue and operating profit of KRW 10.44 trillion as favorable memory market conditions drove higher average sales price (ASP), while robust sales of OLED panels also contributed to the results.

Memory Market Continues To Recover; Solid Second Half Outlook Centered on Server Demand

The DS Division posted KRW 28.56 trillion in consolidated revenue and KRW 6.45 trillion in operating profit for the second quarter.

Driven by strong demand for HBM as well as conventional DRAM and server SSDs, the memory market as a whole continued its recovery. This increased demand is a result of the continued AI investments by cloud service providers and growing demand for AI from businesses for their on-premise servers.

PC demand was relatively weak, while demand for mobile products remained solid on the back of increased orders from Chinese original equipment manufacturer (OEM) customers. Demand from server applications continued to be robust, with second quarter results improving significantly from the previous quarter as the Company responded to demand for high-value-added products for generative AI applications.

The Company strengthened its leadership in the DDR5 market through the mass production of a 128GB product based on 1b nanometer[1](nm) 32Gb DDR5, which was developed for the first time in the industry.

In the second half of 2024, AI servers are expected to take up a larger portion of the market as major cloud service providers and enterprises expand their AI investments. As AI servers equipped with HBM also feature high content-per-box with regards to conventional DRAM and SSDs, demand is expected to remain strong across the board from HBM and DDR5 to server SSDs.

With capacity being concentrated on HBM, server DRAMs and server SSDs for AI applications, conventional bit supply of cutting-edge products for PC and mobile is expected to be constrained.

The Company plans to actively respond to the demand for high-value-added products for AI and will expand capacity to increase the portion of HBM3E sales. The Company will also focus on high-density products, such as server modules based on the 1b-nm 32Gb DDR5 in server DRAM.

For NAND, the Company plans to increase sales by strengthening the supply of triple-level cell (TLC) SSDs, which are still a majority portion of AI demand, and will address customer demand for quad-level cell (QLC) products, which are optimized for all applications, including server, PC and mobile.

The System LSI Business posted record-high sales for the first half of the year as it saw earnings improve in the second quarter due to increased supply of key components such as systems on chips (SoCs), image sensors and display driver ICs (DDIs) for major flagship products.

Initial response to the new SoC for wearables, which features the industry’s first 3nm technology, has been favorable and adoption of SoCs featuring this technology by key customers is expected to expand in the second half of the year. The Company also plans to ensure a stable supply of the Exynos 2500 for flagship models.

The System LSI Business will focus on expanding the application of 200-megapixel sensors from main wide camera to tele cameras and plans to expand sales of DDI products with the start of mass production of new models for a customer based in the US.

The Foundry Business saw improved earnings as a result of increased demand across applications. Due to higher orders for sub-5nm technology, the number of AI and high-performance computing (HPC) customers increased twofold from a year earlier. The Foundry Business also distributed the process development kit (PDK) for 2nm Gate-All-Around (GAA) technology to customers ahead of mass production in 2025.

In the second half, the Foundry Business expects a rebound in mobile demand and continued high growth in demand for AI/HPC applications. As a result, the foundry market is expected to experience growth overall, particularly in advanced nodes. For 2024, on the back of full-scale mass production of second-generation 3nm GAA technology, the Company expects growth to outpace the market.

The Foundry Business plans to continue expanding orders for AI/HPC applications and aims to increase the customer number by fourfold and sales by ninefold by 2028 compared to 2023.

SDC Ready To Meet Increased Mobile Demand in H2, Targets Growth in Large Panels

SDC posted KRW 7.65 trillion in consolidated revenue and KRW 1.01 trillion in operating profit for the second quarter.

The mobile display business posted sales growth, driven by solid demand for flagship products, along with effectively supporting new smartphone launches from key customers. Timely response to customer requests with stable supply of IT OLED products also helped higher results.

In the large display business, sales of high-resolution, high-refresh-rate monitor products expanded, mostly in the gaming monitor market, while TVs maintained a stable sales in the high-end segment, driven by increased penetration of OLED panels.

In the second half of the year, the release of new smartphones from major customers and potential replacement demand with the adoption of AI is expected to lead to an increase in mobile display sales. However, competition among panel makers is likely to be more intense than in the first half.

SDC is manufacturing products with improved performance covering power consumption, brightness, slim design and durability, and will continue to expand sales and profitability through continuous quality insurance and enhanced productivity. For the large display business, SDC plans to increase sales and improve profitability by focusing on high-value-added products and introducing new monitors with various refresh rates.

MX Business To Focus on Flagship Smartphones and Ecosystem Products for Revenue Growth

The MX and Networks businesses posted KRW 27.38 trillion in consolidated revenue and KRW 2.23 trillion in operating profit for the second quarter.

Overall market demand for smartphones declined sequentially, particularly in the premium segment, as seasonal trends continued in the smartphone market. While the MX Business recorded a sequential decline in revenue, the Galaxy S24 series achieved double-digit year-on-year growth in both shipments and revenue over its predecessor for both the second quarter and the first half of the year, demonstrating the continued success of the series.

Profitability declined slightly compared to the previous quarter, primarily due to increased costs stemming from the rising prices of essential components. Nevertheless, the MX business recorded double-digit profitability for the entire first half of the year.

In the second half of 2024, overall demand for smartphones is expected to increase year-on-year, with increased demand for premium products being driven by growing demand for AI and the launch of new products with innovative features. In addition, market demand for ecosystem products such as tablets, smartwatches and smart rings is expected to increase. Accordingly, the MX Business expects smartphone shipments to increase in the third quarter, while tablet shipments are expected to sequentially remain consistent.

The MX Business will seek revenue growth by expanding sales of flagship smartphones and ecosystem products, while also continuing to ensure solid profitability by optimizing product specifications, including component standardization, and pursuing operational efficiencies.

Visual Display Business To Lead Growth in TV Market by Promoting Unique Competitiveness

The Visual Display and Digital Appliances businesses posted KRW 14.42 trillion in consolidated revenue and KRW 0.49 trillion in operating profit in the second quarter.

Overall TV market demand saw a year-on-year increase — primarily in advanced countries — as well as a quarter-on-quarter increase mainly due to global sporting events. Backed by differentiated launches of new TV models in 2024, the Visual Display Business solidified its leadership in the premium market by focusing on selling strategic products, such as Neo QLED, OLED and Lifestyle screens. However, profitability decreased year-on-year as costs increased, due to higher panel prices and intensified market competition.

In the second half of 2024, overall market demand is expected to recover further due to growing demand for QLED, OLED and larger screen TVs. The Visual Display Business will capitalize on peak season demand by implementing sales programs centered around premium and large-size TVs. Moreover, it will promote competitive features like AI, security and design along with differentiated customer experiences enabled by Samsung SmartThings.

Additionally, the Visual Display Business will seek to reinforce its growth momentum by strengthening its service businesses.

[1] Refers to Samsung’s fifth-generation 10nm class DRAM.

The Company posted KRW 71.92 trillion in consolidated revenue on the back of strong sales of flagship Galaxy S24 smartphones and higher prices for memory semiconductors. Operating profit increased to KRW 6.61 trillion as the Memory Business returned to profit by addressing demand for high value-added products. The Mobile eXperience (MX) Business posted higher earnings and the Visual Display and Digital Appliances businesses also recorded increased profitability.

The weakness of the Korean won against major currencies resulted in a positive impact on company-wide operating profit of about KRW 0.3 trillion compared to the previous quarter.

The Company’s total capital expenditures in the first quarter stood at KRW 11.3 trillion, including KRW 9.7 trillion for the Device Solutions (DS) Division and KRW 1.1 trillion on Samsung Display Corporation (SDC). Spending on memory was focused on facilities and packaging technologies to address demand for High Bandwidth Memory (HBM), DDR5 and other advanced products, while foundry investments were concentrated on establishing infrastructure to meet medium- to long-term demand. Display investments were mainly made in IT OLED products and flexible display technologies.

Memory Business Returns to Profit; Second Quarter Expected to Remain Solid on AI Demand

The DS Division posted KRW 23.14 trillion in consolidated revenue and KRW 1.91 trillion in operating profit for the first quarter.

For servers and storage, demand for generative AI showed solid trends, while demand for DDR5 and high-density SSDs remained strong. For PCs and mobile overall, content-per-box continued to grow for both DRAM and NAND, and demand remained robust on the back of active sell-in driven primarily by Chinese mobile OEM customers.

The Memory Business returned to profit as it achieved qualitative growth by addressing the demand across servers, storage, PC and mobile, focusing on high-value-added products such as HBM, DDR5, server SSDs and UFS 4.0., along with the increase in ASP.

Looking ahead to the second quarter, the industry is expected to remain solid, led mainly by demand for generative AI.

For servers and storage, the continuous increase in the supply of AI servers and subsequent expansion of associated cloud services will increase demand not only for HBM but also for conventional servers and storage solutions. Demand for mobile is expected to be stable in the quarter, while PC customers are predicted to be affected by slow seasonality, making them likely to adjust their inventories ahead of new product launches in the second half of the year.

The Company started mass production of HBM3E 8H this month and plans to mass produce HBM3E 12H products and a 128GB product based on 1b nanometer¹ (nm) 32Gb DDR5 within the second quarter. The Company also started mass production of V9 NAND for the first time in the industry this month.

In the second half of 2024, business conditions are expected to remain positive with demand — mainly around generative AI — holding strong, despite continued volatility relating to macroeconomic trends and geopolitical issues.

For HBM, the Company will continue to increase supply in order to respond to growing demand for generative AI. In DRAM, the Company plans to accelerate 1b nanometer-based 32Gb DDR5 supply with faster ramp-up speeds and further strengthen its competitiveness in the high-density DDR5 module market. For NAND, the Company plans to enhance technology leadership by mass producing quad-level cell (QLC) for V9 in the third quarter.

The System LSI Business increased the supply of systems on chips (SoCs) and sensors for major customers’ new products, but earnings improvements have taken longer than anticipated as Display Driver IC² (DDI) sales were impacted by slowing panel demand.

With smartphone sell-out likely to show signs of recovery after a slow start, the System LSI Business will focus on providing a stable supply of flagship SoCs and sensors and is also preparing to ship products based on advanced technologies for new wearables.

For mobile sensors, the utilization rate is expected to remain high, including the mass production of 50MP products for global customers. For DDIs, sales are expected to continue expanding to meet demand from a major customer for new IT/TV products.

Amid a likely intensified pressure for component pricing, the System LSI Business will proactively adjust its product mix to navigate these challenges effectively.

The Foundry Business saw a delay in sales improvement due to weak market demand and continued inventory adjustments. Still, efficiency efforts in fab operations became more visible, which allowed it to narrow losses slightly.

The development of advanced 3nm and 2nm technologies is progressing smoothly, and 4nm technology yields have stabilized. This improvement in advanced technology competitiveness helped the Foundry Business achieve its highest ever order backlog in the first quarter.

Amid a likely gradual recovery in market conditions, second-quarter revenue is expected to rebound and reach double-digit quarter-on-quarter growth after bottoming in the first quarter.

The Foundry Business plans to complete the development of 2nm design infrastructure and prepare 4nm technology applicable to 3D IC. For mature technologies like 14nm and 8nm, it plans to prepare infrastructure for multiple applications.

In the second half of 2024, the foundry market is expected to see limited growth as uncertainties are likely to persist. However, the Foundry Business expects to outpace the market growth rate in annual sales thanks to increased sales of leading-edge technologies of 5nm and below. It will start mass production of Gate-All-Around (GAA) 3nm second-generation technology and improve the maturity of 2nm technology to focus on high-growth applications like AI and high-performance computing (HPC).

SDC To Focus on Flexible Displays and IT/Automotive, Aims for Sales Growth in Large Panels

SDC posted KRW 5.39 trillion in consolidated revenue and KRW 0.34 trillion in operating profit for the first quarter.

In the mobile display business, while intensifying competition led to a decline in earnings from the previous quarter, SDC ensured the timely supply of flexible displays for a major customer’s high-end smartphones and improved the utilization rate for rigid displays.

For the large display business, SDC narrowed losses on the back of new QD-OLED monitor products and a stronger customer base, despite an ongoing curb in demand.

While SDC expects sales to increase in mobile displays with the launch of new foldable phones from a major customer and stronger demand for IT products in the second quarter, earnings growth is likely to be impacted by intensifying competition.

As for large displays, SDC plans to address demand for TV panels for a major customer and seeks to expand sales of premium monitors.

In the second half of the year, SDC will focus on maintaining competitiveness by expanding the sales of flexible displays with low power consumption and improved durability while also continuing to replace LCD displays in smartphones with rigid display products. Furthermore, SDC plans to boost its IT and automotive businesses in order to diversify its business portfolio.

SDC aims to increase large display sales from the previous year by improving the production efficiency of QD-OLED displays and enhancing the product mix, focusing on high-valued-added offerings.

MX Business Posts Revenue Growth Amid Market Decline, Plans Continued Investment in AI

The MX and Networks businesses posted KRW 33.53 trillion in consolidated revenue and KRW 3.51 trillion in operating profit for the first quarter.

Market demand for premium and mid-range smartphone segments decreased sequentially in volume and value as the smartphone market entered the seasonally slower first quarter.

However, the MX Business achieved revenue and operating profit growth due to strong sales of the Galaxy S24 series and maintained solid double-digit profitability through continued efforts in resource optimization. In particular, Galaxy AI features on the S24, such as Circle to Search, continued to see high usage rates and contributed to sales growth.

In the second quarter, overall demand for smartphones is expected to decline sequentially due to seasonality. Accordingly, the MX Business expects smartphone shipments to decline and tablet shipments to remain consistent sequentially.

The MX Business will maintain its flagship-oriented sales approach in the second quarter by applying the Galaxy S24’s AI experience to other flagship models and maximizing product competitiveness. Additionally, the MX Business will aim to secure solid profitability by continuing to streamline operations in light of continued geopolitical instability and likely increases in the cost of key components. At the same time, the MX Business will remain committed to investing in R&D, including in AI, despite a challenging environment.

In the second half of the year, the smartphone market is expected to rebound due to stabilizing consumer sentiment, the expansion of AI products and services and economic growth in emerging markets.

The MX Business will seek annual growth in smartphone sales and aims to maintain sales momentum through the expansion of Galaxy AI to existing and new flagship products across foldable devices and tablets. For wearables, it will strengthen the Galaxy ecosystem experience through the expansion of new models and form factors like the Galaxy Ring. For smartwatches, the MX Business will strive to meet demand for upgrades through the launch of new premium models.

Additionally, the MX Business will continue to seek operational efficiencies to counter rising component costs to ensure solid annual profitability, and it will continue to invest in research and development to further expand and refine Galaxy AI.

Visual Display and Digital Appliances To Continue Breaking New Ground in the AI Era

The Visual Display and Digital Appliances businesses posted KRW 13.48 trillion in consolidated revenue and KRW 0.53 trillion in operating profit in the first quarter.

The Visual Display Business posted higher quarter-on-quarter profitability even as the overall market demand decreased by concentrating on premium products, such as Neo QLEDs, OLEDs and TVs above 75″. However, profitability declined year-on-year due to stagnant TV market demand and increased costs amid intensifying market competition.

In the second quarter, overall market demand is expected to remain weak due to declining TV demand in emerging markets, but major global sporting events may lead to opportunities to increase sales. The Visual Display Business will focus on securing profitability, enhancing sales of strategic products and strengthening operations management in each business segment.

In the second half of 2024, overall TV demand is expected to recover gradually amid an uncertain macroeconomic and geopolitical environment. The Visual Display Business will address diverse consumer needs while promoting “AI Screen Leadership,” driven by innovative premium TVs and Lifestyle screens. Additionally, it will provide differentiated customer experiences through connected devices and drive market growth by promoting advanced features based on security and sustainability, as well as boosting competitiveness in service businesses such as Samsung TV Plus.

¹ Refers to Samsung’s fifth-generation 10nm class DRAM.
² Integrated circuit.

• Consolidated Sales: Approximately 71 trillion Korean won
• Consolidated Operating Profit: Approximately 6.6 trillion Korean won

The above estimates are based on K-IFRS. Please note that Korean disclosure regulations do not allow earnings estimates to be offered as a range. To comply with such regulations, the above figures represent the median of the estimate ranges provided below.

• Sales: 70 trillion to 72 trillion Korean won
• Operating Profit: 6.5 trillion to 6.7 trillion Korean won

※  2023 4Q and 2023 1Q consolidated figures based on K-IFRS are as follows

The Company posted KRW 67.78 trillion in consolidated revenue and KRW 2.82 trillion in operating profit in the quarter ended December 31, 2023. For the full year, it reported KRW 258.94 trillion in annual revenue and KRW 6.57 trillion in operating profit.

Fourth quarter revenue and operating profit increased from the third quarter based on improved performance in Memory due to higher prices, and continued strength in sales of premium display products.

In the first quarter of 2024, the Company will focus on improving profitability by increasing sales of high value-added products. The component businesses aim to meet demand for advanced products and those aimed for generative AI while the Device eXperience (DX) Division will strengthen AI features in smartphones and other consumer products.

The memory market and demand for IT are expected to continue recovering in 2024, though macroeconomic uncertainties remain to be seen. The Company will meet demand for semiconductors for AI applications and expand into AI-enabled consumer product markets. At the same time, the Company will strengthen its leadership in premium products and competitiveness in advanced-node semiconductors.

As ongoing macroeconomic uncertainties are expected to weigh on the business environment in the near-term, the Company expects earnings in the first half of 2024 to show a moderate improvement, with a more significant improvement expected to take place in the second half of the year.

The Company’s capital expenditures in 2023 reached a total of KRW 53.1 trillion, including KRW 48.4 trillion spent in the Device Solutions (DS) Division and KRW 2.4 trillion in Samsung Display Corporation (SDC). In the fourth quarter, the total was KRW 16.4 trillion, with KRW 14.9 trillion allocated to the DS Division and KRW 0.8 trillion to SDC.

Spending on memory was concentrated on building out infrastructure at the facility in Pyeongtaek, Korea and expansion of production capacity of HBM, DDR5 and other advanced nodes. Foundry investments focused on expanding the production capacity of advanced EUV nodes of 5 nanometers (nm) and below, as well as infrastructure at the Company’s factory in Taylor, Texas. Display investments were mainly made in IT OLED products and flexible displays.

Semiconductor Demand To Recover Gradually in 2024

The DS Division posted KRW 21.69 trillion in consolidated revenue and KRW 2.18 trillion in operating losses in the fourth quarter of 2023.

For the Memory Business, the overall market showed a recovery compared to the previous quarter, with content-per-box continuing to increase for PC and mobile. Server demand showed signs of recovery as investments in generative AI expanded across the IT industry.

The Memory Business also focused on expanding sales of high value-added products, leading to significantly higher sales of cutting-edge solutions like HBM, DDR5, LPDDR5x and UFS 4.0, among others. As a result, its bit growth exceeded market growth, and inventory depletion of DRAM and NAND accelerated. The DRAM business posted a profit on the back of higher prices.

Looking to the first quarter of 2024, PC and mobile demand recovery is expected to continue, while server and storage demand will show signs of recovery, though market conditions need close monitoring. In terms of industry supply, bit growth of cutting-edge products is anticipated to face constraints across the market while consumer demand for advanced-node products is predicted to stay strong. The Memory Business will focus on responding to demand for cutting-edge products and intends to improve profitability by actively addressing demand for HBM and generative AI-related server SSDs.

In 2024, the Memory Business expects the market to continue to recover despite various potential obstacles, including interest rate policies and geopolitical issues. For PC and mobile, content-per-box is expected to grow due to the impact from expansion of on-device AI. As far as servers are concerned, server replacements and transitions to new platforms will likely lead to a gradual recovery in demand. Additionally, the Memory Business plans to focus on profitability based on the competitiveness of cutting-edge nodes.

For DRAM, the aim is to enhance leadership in the high-density DDR5 market and solidify competitiveness in HBM by ramping up the volume of next-generation HBM3E in a timely manner. For NAND, the Memory Business will respond to customer demand for high-density storage by being the first in the industry to enter the mobile QLC market, and by leading the Gen5 SSD market for generative AI applications.

Due in large part to inventory adjustments and the selection of Exynos 2400 for a major customer’s flagship model, the System LSI Business saw its earnings improve in the fourth quarter.

In the first quarter of 2024, sales of new SoCs and high-pixel image sensors are expected to remain strong. However, demand for some SoCs is expected to decline, and earnings are likely to worsen — mainly for mobile display driver IC (DDI) — so overall earnings improvement is predicted to be somewhat limited. However, the introduction of on-device AI provides an opportunity to restore the desire of consumers to replace their smartphones.

Although the smartphone market is expected to rebound in 2024, it is believed that the normalization of chip prices and higher financial costs will erode set makers’ promotional capabilities, limiting demand growth.

The System LSI Business will secure future growth engines by leveraging AI momentum and maximizing SoC, sensor and LSI business competitiveness. It plans to continuously improve on-device functions like NPU performance improvement and model weight reduction. For image sensors, it will expand sales of high-pixel sensors and DDIs and will achieve growth, even in uncertain environments, as IT devices adopt more OLEDs.

The Foundry Business saw its earnings decline in the fourth quarter due to a delay in global economic recovery. Despite these challenges, it is actively developing 3nm and 2nm Gate-All-Around (GAA) technology and plans to expand into newly emerging application segments using advanced process technologies. Furthermore, the Foundry Business achieved its highest annual order backlog in 2023.

In the first quarter of the year, it expects the launch of new products including AI smartphones and AI PCs to drive an improvement in demand. However, the ongoing trend of customers reducing inventory may mean that earnings will not significantly recover. Nevertheless, the Foundry Business is focused on improving yield and optimizing the second-generation 3nm GAA process. It is also securing a 2nm AI accelerator order that includes HBM and advanced packaging.

As demand for smartphones and PCs gradually recovers in 2024, advanced processes are expected to drive an approach to 2022 levels in the foundry market. The Foundry Business will continue stable mass production of the 3nm GAA process, develop the 2nm process and increase orders for fast growing applications such as AI accelerators.

Mobile Display To Focus on Smartphones and IT/Auto; Large Display To Improve Profitability

SDC posted KRW 9.66 trillion in consolidated revenue and KRW 2.01 trillion in operating profit for the fourth quarter.

For the mobile display business, the market demand for smartphones increased slightly year-on-year. Despite facing multiple challenges during the quarter, SDC maintained its performance compared to the previous quarter by ensuring a timely supply for major customers’ new products and focusing on high-end products in its product mix.

For the large display business, although demand remained weak due to unfavorable economic conditions, SDC posted sales growth and reduced losses backed by year-end seasonal TV demand.

In the first quarter of 2024, SDC expects a decline in mobile display business earnings due to intensifying competition among panel manufacturers and muted seasonal demand.

For the large display business, despite challenges posed by weak demand and off-season effects, SDC will continue its efforts to reduce losses by launching new QD-OLED monitors and expanding its customer base.

In 2024, the market demand for smartphones is expected to be sluggish due to the global economic slowdown and prolonged regional conflicts. Nevertheless, SDC aims to focus on sales growth based on differentiated technology and capabilities in the smartphone market, particularly in the highly competitive high-end segment. It also intends to strengthen its future growth engines in the IT and Auto segments.

Although ongoing macroeconomic uncertainties pose challenges to the large display business, SDC expects TV demand to recover moderately, buoyed by upcoming sporting events. It will closely monitor market developments and work towards improving profitability by centering QD-OLED monitors in its product mix, enhancing production efficiency and adding capacity without additional investments.

MX Maintains Double-Digit Profitability, Will Become Global Standard for Mobile AI with Galaxy AI

The MX and Networks Businesses posted KRW 25.04 trillion in consolidated revenue and KRW 2.73 trillion in operating profit for the fourth quarter.

Market demand for smartphones increased slightly quarter-on-quarter, driven by the premium segment, despite continued inflation and geopolitical instability.

The MX Business reported a decline in sales and profit quarter-on-quarter due to lower smartphone sales, including the fading of new-product effects from flagship models launched in the third quarter. However, tablet shipments, led by new product releases, grew significantly and included healthy sales of premium products. Wearable devices also maintained sales momentum during the peak holiday season.

In the first quarter of 2024, smartphone market demand is expected to decline sequentially due to seasonality, but the premium segment is expected to grow year-on-year. Accordingly, the MX Business plans to leverage the newly launched Galaxy S24 series – which brings advanced AI capabilities and enhanced product competitiveness – to expand sales of flagship products. The MX Business will also continue to focus on operational efficiency.

In 2024, smartphone market demand is expected to rebound as consumer sentiment stabilizes in anticipation of a global economic recovery, leading to market growth, especially in the premium segment. Similarly, the tablet market is expected to recover, while the wearables market is forecasted to achieve double-digit value growth for smartwatches and slight value growth for True Wireless Stereo (TWS) devices.

The MX Business aims to lead the AI smartphone market by offering customers a differentiated experience through the integration of Galaxy AI in the S24 series, while also enhancing the user experience and optimizing Galaxy AI for foldable devices. Through these efforts, the MX Business aims to grow its annual flagship shipments at a double-digit rate and solidify its leadership in the foldable category.

In addition, the MX Business will continue to focus on sales of premium devices for tablets. For wearables, it will strive to elevate the Galaxy ecosystem experience, enhance wellness functions in smartwatches and increase the smartphone attach rate by integrating AI technologies.

Through these efforts, the MX Business aims to achieve revenue growth and ensure solid profitability by continuing to optimize resources amid unstable market conditions. Finally, the MX Business will strengthen R&D and investment in future growth areas such as generative AI, digital health and XR.

Visual Display and Digital Appliances To Lead the AI Era

The Visual Display and Digital Appliances Businesses posted KRW 14.26 trillion in consolidated revenue and KRW 0.05 trillion in operating losses in the fourth quarter.

Overall market demand for TVs increased quarter-on-quarter in the fourth quarter, led by seasonality, but declined year-on-year due to reduced consumption sentiments among advanced markets.

The Visual Display Business expanded its leadership in the premium market by focusing on selling high-value-added products — including Neo QLEDs, OLEDs, and Big TVs above 75″ to preemptively respond to high demand during the peak season, including Black Friday.

However, profitability decreased slightly on a quarter-on-quarter and year-on-year basis due to the stagnant TV market demand and increased costs amid intensified competition.

In the first quarter of 2024, overall TV demand is expected to decrease owing to seasonality, apart from the premium market, including Neo QLEDs, OLEDs, and Big TVs above 75″, where solid demand is projected.

The Visual Display Business will amplify the buzz created by launching new premium models announced at CES and its showcase event First Look and, in order to focus on sales of strategic products and securing profitability, take a more proactive approach to promoting differentiated products and service.

In 2024, replacement demand linked to global sporting events is expected to ease the decline in TV market demand gradually. However, uncertainties surrounding various macro factors are anticipated to continue.

The Visual Display Business aims to innovate its premium and Lifestyle products and diversify its lineup to meet various customer needs. Furthermore, it will lead the AI-screen era by continuing to introduce innovations in hyper-connectivity and customized content and services, powered by its next-generation AI processor and Tizen operating system.