Samsung Electronics' 2023 business performance is expected to see a 14.3% decrease in sales compared to 2022 due to factors such as a decrease in profits due to the deteriorating semiconductor market.

Samsung Electronics announced its 2023 business performance and 2023 fourth quarter business performance on January 31.

Accordingly, annual total sales in 2023 were recorded at KRW 258.9355 trillion based on consolidated financial statements, down 14.3% year-on-year, and operating profit was KRW 6.567 trillion, down 84.9% year-on-year. Net income for the period was KRW 15.4871 trillion, down 72.2% year-on-year.

In response, Samsung Electronics announced that its profits had decreased due to the deterioration of the semiconductor market.

As evidence of this announcement, Samsung Electronics' semiconductor division (DS) recorded operating profit in the red every quarter last year, posting an annual deficit of 14.88 trillion won.

Sales for the fourth quarter of 2023 were KRW 67.7799 trillion based on consolidated financial statements, down 3.8% year-on-year, and operating profit was KRW 2.8247 trillion, down 34.4% year-on-year. Net income was 6.3448 trillion won, a 73.4% decrease from the same period last year.

In the fourth quarter, smartphone shipments decreased due to intensifying competition during the peak season at the end of the year, but sales of premium display products and rising memory prices were brisk.

In terms of operating profit, memory performance improved significantly amid intensifying competition in set products and a decline in the effect of flagship smartphone launches, but the semiconductor division recorded an operating loss of KRW 2.18 trillion.

In 2024, the memory market and IT demand are expected to recover. Samsung Electronics plans to actively respond to AI semiconductors and take the lead in the AI-equipped product market, while strengthening its premium leadership and advanced process competitiveness and preparing for future technologies.

However, the company-wide performance is expected to be low at the top and high at the bottom due to macroeconomic uncertainty and differences in the recovery speed by product.

Meanwhile, Samsung Electronics decided on a year-end dividend of 361 won per common share and 362 won per preferred share on the 31st. According to the annual dividend amount in accordance with the shareholder return policy, the total dividend for the fourth quarter will be 2.45 trillion won, and will be paid after final approval at the regular shareholders' meeting in March.

The three-year shareholder return policy of returning 50% of free cash flow and distributing KRW 9.8 trillion in dividends annually from 2021 to 2023 will end with the final dividend payment.

The total surplus cash flow for the three years from 2021 to 2023 was KRW 18.8 trillion, and 50% of the surplus cash flow, which is the source of shareholder return according to policy, is approximately KRW 9.4 trillion.

Samsung Electronics will pay a total of KRW 29.4 trillion in dividends over the three years, including this year-end dividend, which is equivalent to 157% of total free cash flow and 313% of shareholder return resources.