Samsung’s mobile division registered strong growth in profitability in the final quarter of 2023 despite falling smartphone shipments, driven by demand for premium models and rising ASP.

Revenue in its Mobile eXperience (MX) and Networks division fell 7 per cent year-on-year to KRW25 trillion ($18.7 billion), with the unit’s operating profit increasing 60.6 per cent to KRW2.7 trillion.

MX VP Daniel Araujo said on Samsung’s earnings call the profit growth was aided by improved resource utilisation and hardware design.

Smartphone ASP rose 7.5 per to $258, though shipments fell 8.6 per cent to 53 million units and tablets 12.5 per cent to 7 million.

Despite sluggish overall demand in the current quarter, Araujo said Samsung expects shipments of premium models and ASP to rise, with tablet shipments likely to decline.

For the full year, the vendor forecasts consumer sentiment to stabilise and demand to rebound in anticipation of a soft landing for the global economy, leading to smartphone growth, especially in the premium segment.

It also expects the tablet market to bounce back after contracting in 2022 and 2023.

Samsung predicts double-digit growth in smart watch sales, with consumers in the mass market looking to upgrade due to increased interest in health-related features, he noted. 

On a group level, net profit fell from KRW23.8 trillion in Q4 2022 to KRW6.3 trillion, with sales down 3.8 per cent to KRW67.8 trillion.

The company said overall demand for memory chips appears to have recovered as inventories returned to normal levels, with EVP of investor relations Daniel Oh stating price increases are likely to spur demand for inventory build-ups.

Its chip business revenue grew 8 per cent to KRW21.7 trillion, driven by a 29 per cent rise in memory sales to KRW15.7 trillion.