- cross-posted to:
- [email protected]
- cross-posted to:
- [email protected]
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The chip business posted quarterly operating profits of only ₩400 billion ($288 million), down sharply from ₩6.45 trillion ($4.64 billion) a year earlier. Revenue also declined to ₩27.9 trillion ($20 billion) from ₩28.56 trillion ($20.5 billion) in 2024.
Where did the $4.64 billion a year ago profit in the chip division come from? I don’t remember any major customer wins in 2024 and one would think with Samsung fabbing the Switch 2 SoC, there would be an increase in absolute profit values (if not margins).
Maybe last year is when the contract for the Switch 2 was signed and paid?
I don’t have professional experience in semiconductor contracts, but it seems unlikely that an upfront payment format would be used; I would assume payments (i.e. revenue and profit) would be tied to quarterly unit delivery figures (more in Q3/Q3 to cover season demand peak).
Perhaps this is tied to intra-company transactions (decline in Exynos fab orders?); but I would still think Switch 2 SoC should have a positive impact on current profit. They didn’t just sign a contract on near break even terms, did they? :)
I was thinking it may be a mix of both, an upfront contract last year, and continual payments
Unless someone with experience in such contracts is using Lemmy (and reading this community), we can only speculate. :)
It’s quite likely that Switch 2 have been in production for a couple of years already given massive stockpiles they had for release. There’s plenty of circumstantial evidence that they delayed Switch 2 because Switch 1 was selling like hotcakes and there was no good launch lineup.
