Samsung Electronics misses forecast on lower phone sales

02 August, 2018, 22:04 | Author: Bennie Parsons
  • Galaxy A

Despite having an Unpacked event scheduled for 9 August, Samsung has chose to suddenly announce the new Galaxy Tab S4 tablet online. Analysts pointed to increased competition among Android manufacturers for the slowing growth, with the firm's flagship Galaxy S9 device missing sales targets.

The consolidated net profit was 11.04 trillion won ($9.85 billion).

Revenue in Samsung's mobile division declined 22 percent in the quarter to 22.67 trillion won ($20.2 billion).

Samsung came out with a rosy outlook on the product sector in the second half, citing anticipation of continuing demand regarding server expansion and the release of new smartphones that are to use its chips.

The South Korean tech giant said that its April-June net income stood at 10.98 trillion won ($9.8 billion), up 2 per cent from 10.80 trillion won a year earlier.

The disappointment over the second quarter earnings was reflected in mid-morning trade, with Samsung Electronics shares down 0.7 percent.

Looking ahead, Samsung expects sustained strength in the memory market and growing demand for flexible OLED panels to drive earnings higher in the second half.

While Samsung's profit growth may have slowed, the company's chip sales have been stellar. People are holding on to their high-end smartphones for longer periods of time between upgrades, Lee said, meaning fewer people are rushing out to buy flashy new models each year.

Samsung Galaxy Note 9 will be presented to a global audience on August 9 in NY. Samsung globally is also facing competition on its less expensive phones from Chinese smartphone makers such as Huawei and Xiaomi.

"The market for the premium smartphones decreased, and the market also resisted against the increase in prices", Samsung said, claiming it failed to enjoy immediate effects of various financial programs to promote the sales of its products. Also, Samsung plans to strengthen price competitiveness and adopt advanced technology in the mass models.

Samsung then said it is preparing the release of micro LED TVs customized for businesses and households, respectively.

Adding to its troubles, its vice-chairman Lee Jae-yong, scion of Samsung's founding family, was jailed past year for his part in the sprawling corruption scandal that brought down former president Park Geun-hye.

It brought the total spent in the first half to 16.6 trillion won (14.8 billion US dollars).

Samsung's fortunes in the mobile market are vital as mobile accounts for about 40 percent of its revenue. The second-quarter report was announced before the stock market's opening Tuesday.



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