Samsung Electronics Careful in Second-Quarter, says Mobile Business Environment

Published Date : Jul 31, 2015

On Thursday, after the April-June profit dropped, Samsung Electronics Co Ltd provided a modest outlook for the third quarter in the market. The outlook was on the supply shortage for Samsung’s one of the smartphone models. The outlook emphasized headwinds about the tech giant. 

In the second quarter, Samsung has remained dominant across the globe as the world’s leading smartphone seller. The curved screen S6 edge smartphones are expected to cost the South Korean firm in April-June due to its inability to meet the customer demands. 

The operating profit in the second-quarter fell 4% to 6.9 trillion won. The designed figure matched the estimate issued by Samsung early this month. However, the firm doubled its provisional dividend payout to 1,000 per common share. 

The mobile business also reported an operating profit of 2.76 trillion won – a fall from 4.42 trillion won a year prior to the current. While 2H 2015 will present intimidating challenges as the company will try to improve earnings, said Samsung in a statement. 

The company said the supply problem has been resolved. Now Samsung is bringing forth the launch of its new model Galaxy Note phone. The company is planning to launch it at flexible pricing for its premium Galaxy S6 models just to keep the sales high. 

According to the analysts, disclosing Apple Inc’s new iPhones in the month of September will limit the sales growth in the third quarter. The mobile division experiences a tough business environment as smartphone market growth slows down. 

However, on the good side, the chips division had an operating profit of 3.40 trillion won. The segment is back on the healthy demand for memory chips and sales growth for mobile processors.  

The annual profit is expected to rebound from a three-year low marked in 2014. Thanks to the growing semiconductor profits and stabilization for the mobile business. 

Some analysts are worried from Europe and China about the supply shortage for the S6 edge model.