Samsung's earnings report and forecast reeks with negativity, something the big bosses hate to hear. The major bottom line here is that publicity doesn't always equate to cash.
At the surface, as one of the largest tech giants in the world, it might be safe to say that Samsung ought to benefit from the turnaround enjoyed by its competitors.
The earnings projections that the company made public just weeks ago for the fourth quarter of 2019 showed that its full-year sales would plunge a whopping 54 percent compared to the previous period.
That was confirmed early Friday when Samsung released its full earnings report for the fourth quarter. The tech behemoth disclosed Friday that its operating profit collapsed 35 percent to $6 billion in the period ended December, in connection with the forecast it released earlier this month.
Samsung's profits were up 1 percent to nearly $50.5 billion, beating estimates of a 4.5 percent loss. The company's stocks settled down 3.1 percent in Seoul trading, late Thursday.
In reality, a major reason why the company is suffering while its rivals are not is that the company's main source of income - microchips and monitors - are exactly the most fragile components of the tech industry at the moment.
Samsung's semiconductor business reported a 57 percent plunge in operating income and its monitor unit dropped 78 percent. Between these, component divisions often contribute 50 percent to two-thirds of the company's sales.
Intel Corp., TSMC and even Advanced Micro Devices don't fiddle in such commodity items. When business is peaking in the microchip and monitor segment, Samsung rises because it is the world's biggest supplier of these products.
But when things are gloomy, like now, the company gets battered the most. That misery is expected to drag on in both business lines in the next months, with stakeholders noting that continued sluggishness in demand will impact its revenues.
Last year highlighted Samsung's worst period since 2015, according to Reuters, with its operating profit shedding by 53 percent. Apple on Wednesday reported its total sales for the December period rose almost 9 percent to $91.82 billion, while its earnings also rallied.
The results show the difference between the performances of the two tech rivals, largely because of the disparity between their strategies where they are making bets. Samsung is popular as a phone and TV maker, but it also sells more chips compared to any other company on the planet.