Apple rival Samsung forecasts high profits despite Note 7 fires & political scandals

Samsung Electronics on Friday announced a forecast of its best profits in over three years for the March quarter, despite dealing with the fire-prone Galaxy Note 7, and a political scandal that resulted in the arrest of vice chairman Jay Y. Lee.

Operating profits likely hit $8.8 billion, beating an analyst consensus of just under $8.3 billion, Reuters reported. Overall revenue is estimated to have grown 0.4 percent to over $44 billion, again topping analyst predictions.

Sales are thought to have been fueled by Samsung's semiconductor business, and to a lesser extent low- to mid-range smartphones. The company is world's biggest memory chip supplier, topping the likes of Toshiba, and riding high on a memory "super-cycle."

Battery problems with the Note 7 led to two recalls and the eventual termination of the product. In January, Samsung estimated that the debacle would cost it $5 billion, without factoring in any damage to its reputation.

Lee is accused of directing money to Choi Soon-sil, a close friend of ousted South Korean President Park Geun-hye, in return for political favors — above all, support from the National Pension Services for a 2015 merger between Cheil Industries and Samsung C&T, which gave Lee more power within the Samsung Group. On Friday, the executive appeared in a Seoul courtroom. Other Korean corporations have also been accused of undue influence.

Samsung's fortunes could improve still further with the release of the Galaxy S8 later this month. The phone contains many features expected for Apple's "iPhone 8," such as a curved, 5.8-inch OLED screen, virtual buttons, 3D facial recognition, and augmented reality functions.

63 Comments

anantksundaram 20390 comments · 18 Years

About 7 years ago

It's their chip business that's going gangbusters.

They can thank Apple.

sockrolid 2789 comments · 14 Years

AppleInsider said:

... Samsung's fortunes could improve still further with the release of the Galaxy S8 later this month. ...
There is certainly pent-up desire for the Galaxy S8.
But only among customers who haven't already switched to iPhone 7 and 7 Plus.

rotateleftbyte 1630 comments · 12 Years

sockrolid said:

AppleInsider said:

... Samsung's fortunes could improve still further with the release of the Galaxy S8 later this month. ...
There is certainly pent-up desire for the Galaxy S8.
But only among customers who haven't already switched to iPhone 7 and 7 Plus.

Samsung is spending big on promotions for the S8. Two of the UK networks that have retail outlets near to me are wall-to-wall Samsung S8 billboards. It is as if there are no other phones available.
They are also advertising a lot on TV. Pre-order now and get it 8 days early.
One other MNVO outlet is also Wall-to-wall Samsung, this time the Galaxy A.

Bang goes their profits then?

sflocal 6133 comments · 16 Years

Samsung Electronics I can see... Apple certainly contributed to that. Samsung Mobile is something else entirely. Lets see what happens. Samsung is already known for being a lying miscreant when it comes honesty in the courtroom.

I think Samsung buyers either don't care about quality, or they have the attention span of a gnat and Samsung is banking on that.

andyshannon 20 comments · 17 Years

This is what happens when you innovate, put out devices with the latest cutting edge technology in them, like wireless charging, fast charging, waterproofing, give customers a headphone jack, a fully customizable OS, smartwatches that will pair with any other mobile device, a VR ecosystem at a great price. All make for a winning formula. Plus make all the most important parts (screens, chipsets, memory) for the other biggest mobile phones out there too, you are gonna make some big money!