Samsung Electronics Co. Ltd. reported solid earnings in its fiscal fourth quarter, but the South Korean chaebol’s smartphone division struggled against Apple Inc.’s launch of the iPhone 12.

For the quarter ended Dec. 31, Samsung posted KWN 61.55 trillion ($55.27 billion) in revenue and an operating profit of KWN 9.05 trillion ($8.12 billion), the latter up 26% year-over-year primarily boosted by sales of its memory chips.

Although the headline figure was positive, the profit was down 26.7 percent from the third quarter due to weaker memory prices and sluggish consumer product sales. A shift in the value of the South Korean Won against the U.S. dollar also resulted in a negative impact on Samsung’s figures, KWN 1.4 trillion ($933.4 million), according to a statement from Samsung.

Despite the earnings decline, Samsung’s memory business saw increased shipments in the fourth quarter. The company’s display panel business also grew solidly in the quarter both year-over-year and sequentially thanks to a sharp rise in mobile display production and improved demand in the large panel market.

With no major product launch in the quarter, the Samsung Galaxy Note 20 having launched in August, Samsung’s phone line up suffered from lower sales. Samsung spun the result as being in line with its earnings a year earlier, supported by continued efforts to optimize costs. But Samsung’s smartphone sales dropped 11% in the quarter as buyers, particularly in the U.S., purchased the iPhone 12 and its variations.

Samsung’s rival in the U.S. market, Apple Inc., reported $111.4 billion in revenue in its latest earnings report today, up 21% year-over-year based on strong sales figures for the iPhone 12 lineup.

Still, Samsung’s display panel sales rose — thanks to the success of the iPhone 12. Samsung’s display unit manufactures the OLED screens used in the iPhone 12. According to Reuters, the success of the iPhone 12 kept Samsung’s OLED production near 100% capacity over the quarter.

Along with its earnings report, Samsung also announced a three-year shareholder return policy that will increase its regular dividends to KWN 9.8 trillion ($8.8 billion) for 2021 to 2023.

For the quarter ahead, Samsung said, it expects a recovery in overall global demand, in part because of the launch of the Galaxy S21, but uncertainties exist over the possibility of new COVID-19 outbreaks. The company specifically noted that its memory business, specifically the DRAM market, is expected to see a recovery during the first half thanks to strong demand from mobile and server applications.

Photo: DennisM2/Flickr