Samsung to Focus on LCD Profits Rather Than Growth

Samsung Electronics is shifting its LCD focus to profitability from capital investment as a means of growth, a sign that the competitive market for LCDs will soon take a toll on manufacturers' profit margins. Until very recently, competitive pressures have forced an arms race among the likes of Samsung, Sony and Sharp to invest in new production facilities while also slashing prices. It doesn't take an economist to figure out that that is a recipe for long-term failure, so Samsung is adopting the viewpoint that its eighth-generation plant soon to come online will be sufficient to grow its capacity, particularly for large panels 50-inches and up. Stable growth and increasing profits will be the mantra from now on, especially as demand for LCDs slows in the first half of '07.

The Wall Street Journal, which is free today courtesy of Philips, has the full story.