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Samsung Electronics’ domestic net sales drop to 8-year low

Samsung Electronics, the world’s largest smartphone-maker, recorded its lowest domestic net sales in eight years due mainly to its sluggish smartphone business and challenge posed by its rival Apple, according to an audit report Monday.

The Korean tech giant said in the report that its net sales stood at 20.7 trillion won, down 9 percent on-year.

Net sales is gross sales less profits earned through transactions with subsidiaries.

The net sales of the Seoul-based firm had been rising since 2007 when the firm passed the 20 trillion won mark for the first time, booking 21.1 trillion won.

Backed by its robust smartphone and electronics businesses, the upward movement continued until 2012.

Facing steep competition from low-cost Chinese smartphone makers and Apple which has a loyal consumer base, however, Samsung’s net sales has been declining since 2013.

In particular, Samsung’s IM division in charge of handset businesses posted 11.2 trillion won last year, down 19.5 percent from a year earlier while the firm’s display business booked 25.7 trillion won, down 13.8 percent on-year.

Its domestic net sales accounts for only 10.1 percent of the global net sales of the firm, while those in the Americas, Europe, Asia and Africa, and China took up 33.3, 20.8, 19.8 and 16 percent, respectably.

Samsung was also hit by a significant decrease in net sales around the globe as it saw its sales in Europe drop by 22.7 percent, in China by 17.7 percent, Asia and Africa by 6.6 percent and in Americas by 1 percent.

By Kim Young-won (