Samsung Electronics' profit growth slows as Galaxy S9 misses sales targets

Adjust Comment Print

Amid the stagnant high-end smartphone market, Samsung reported a drop in earnings, both year-on-year and quarter-on-quarter, over slow sales of the Galaxy S9 and S9+ premium smartphones. And sales should improve in the second half of 2018, thanks to a normal seasonal uptick.

Competition from cheaper Chinese brands like Xiaomi Corp (1810.HK) and Huawei HWT.UL have already seen Samsung lose market share in China and India, the world's top smartphone markets. In addition a sooner-than-expected launch date for its next generation Galaxy Note model, Samsung will work towards more competitive pricing and quicker adoption of future technology overall, throughout all of its lines of product.

"It is not an easy game for Samsung unless it really meets consumer's needs for new smartphones".

But with competition "intensifying"-Apple is rumored to be readying three new iPhone models for this fall-Samsung will introduce its new Galaxy Note 9 "earlier than usual", and the device will offer customers "exceptional performance for a reasonable price", the firm says".

More news: North Korea developing new missiles

Samsung posted revenue of 58.4 trillion won ($52.1 billion) for the period, down 4% compared to past year, and operating profit of 14.87 trillion won ($13.3 billion), which is up 6%.

Samsung has suffered a number of setbacks including an embarrassing.

Samsung's mobile business accounts for almost 40 percent of the company's sales. The consolidated net profit was 11.04 trillion won ($9.85 billion).

Revenue for the April-June period fell 4 percent to 58.5 trillion won.

More news: Harley-Davidson Announces Pan America Adventure Motorcycle for 2020

The results reflect Samsung's troubles in shoring up its mobile business, despite resilient demand for its memory chips.

The chip unit posted a record 11.6 trillion won operating profit in the second quarter, up 45 percent from a year ago and almost 80 percent of its total operating income.

Earlier this month, analysts warned that Samsung's Galaxy S9 smartphone could be the worst selling Galaxy S series phone since the release of the Galaxy S3 in 2012.

The Korean giant expects similarly impressive results in the second half of the year, along with growing demand for flexible OLED panels.

More news: Trouble already brewing between Kawhi Leonard and the Raptors?

That view echoed South Korean rival SK Hynix's forecast last week for solid DRAM chip sales for the rest of the year, comments likely to ease investor concerns that an unprecedented two-year boom in the chip business is about to come to a rapid end.