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Semiconductor industry

Samsung's Net Income Falls Short of Intel's in Q1 2005

Strategic Insights

— 1 min read

Samsung Electronics Co. has seen its net income fall behind that of Intel Corp. for the second consecutive quarter, with industry insiders attributing the decline to unfavorable foreign exchange rates. Despite leading in overall sales volume, Samsung's net income plummeted by 52.2% compared to the same period in 2004, when the company posted record earnings. Intel, on the other hand, witnessed a strong demand for its Centrino chips, resulting in a 25% increase in net income to $2.15 billion.

Key Takeaways:

  • Samsung's net income fell short of Intel's for the second straight quarter, with Samsung's net income totaling $1.46 billion and Intel's net income growing to $2.15 billion.
  • Samsung's sales volume stood at 13.48 billion, a 4.2% dip from the same period in 2004, while Intel's sales reached $9.43 billion, a 17% year-on-year increase.
  • The sharp appreciation of the Korean won against the U.S. dollar led to a 900 billion won (approximately $894.6 million) loss in operating profit for Samsung.
  • Intel's strong Centrino chip sales led to increased production, despite a sluggish IT market, resulting in a 32.1% operating profit rate for Intel compared to Samsung's 15.6%.
  • This marks the fourth consecutive quarter where Intel has surpassed Samsung in net income, with Samsung first surpassing Intel in Q1 2001 but Intel reclaiming the top spot in 2003.
  • The South Korean firm had dominated the net profit rankings from 2001 to 2004, with Intel regaining the lead in Q4 2004 and maintaining it in the following quarter.

Statistics:

  • Samsung's net income in Q1 2004: $3.00 billion (52.2% drop to Q1 2005)
  • Intel's net income in Q1 2005: $2.15 billion (25% increase from Q1 2004)
  • Samsung's sales volume in Q1 2005: 13.48 billion (4.2% dip from Q1 2004)
  • Intel's sales volume in Q1 2005: $9.43 billion (17% year-on-year increase)
  • Number of quarters Intel has surpassed Samsung in net income: 4 (Q1 2005, Q4 2004, and two consecutive quarters in 2003)

Sources:

  • (Yonhap)
  • Asia Pulse, "Samsung's Net Income Falls Short of Intel's in Q1 2005"
  • Samsung Electronics Co. press release (no specific date mentioned)

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