Samsung Q2 Profit Down, Smartphones Slump
Samsung Electronics has post lower-than-expected Q2 earnings, with net profit dipping 0.1% on-year, following lacklustre smartphone sales. Earnings are a stark contrast from Q1’s bumper result, posting a 52% year-on-year increase.
For the period April to June, net profit notched 11.04 trillion won (US$9.86 billion) – lower than Bloomberg analyst expectations for 11.6 trillion won (US$10.36 billion).
Results dipped below an 11.05 trillion won net profit recorded for the same period last year.
Operating profit climbed 5.7% to 14.87 trillion won, in line with Samsung’s preliminary earnings guidance.
Revenue slipped 4% to 58 trillion won, also in line with previous estimates.
Samsung’s Q2 results were hampered by soft sales of its Galaxy S9 smartphone, with many consumers citing minor incremental differences between its predecessing handset.
Results were boosted by strong TV sales, complemented by the 2018 World Cup.
The company’s semiconductor business achieved record operating profits of 11.6 trillion won, however, results missed analysts forecasts for 12 trillion won.
The Korean giant expects chip prices to remain strong in the coming months, citing continued demand for DRAM chips.
Analysts expect Samsung’s semiconductor division to continue its growth trajectory, forecasting record results for Q3.
The Korean tech giant expects continued OLED panel growth to drive higher earnings in the second half of the year.
By contrast, mobile competition is tipped to stay strong in the second half of 2018. Samsung aims to bolster results through an increasingly diversified portfolio, coupled with its upcoming Note 9 and Galaxy S10.
The company’s first foldable smartphone – currently dubbed the Galaxy X – is also tipped to breathe new life.