AppleInsider Staff
Korean investors have begun to back off their formerly hopeful predictions that Samsung's updated flagship Galaxy S6 smartphone could mitigate the conglomerate's recent financial freefall, thanks to seemingly lackluster sales of the new handsets.
"After the first-quarter results the consensus for second-quarter earnings was somewhere in the high 7 trillion won ($6.2 billion), but now I think so long as the first digit doesn't start with a six it won't be a shock," HDC Asset Management fund manager Park Jung-hoon told Reuters. Samsung is expected to announce its second-quarter earnings guidance on Tuesday.
Some 20 of the 39 investment analysts surveyed by Thomson Reuters say that they have reduced their second-quarter Samsung forecasts within the last 30 days. The ongoing economic woes in Europe are a factor, as are reportedly constrained supplies of the more expensive S6 Edge.
Despite the revisions, analysts still believe that Samsung will guide operating profit above $7 trillion won, with a full-year profit of 27.8 trillion won in 2015. That would represent a sizable increase from the 5.98 trillion won operating profit the company posted for its first quarter.
Though Samsung has numerous and diverse interests in everything from heavy industry to household appliances, its mobile division has become its core business in recent years, and the division's slide has dragged the company down in the midst of a generational leadership change. Declining sales of high-volume, low-cost feature phones coupled with an explosion in popularity for Apple's iPhone and "white box" competitors out of China have driven South Korea's largest company into a pit it is just beginning to emerge from.
Malcolm Owen
Andrew O'Hara
William Gallagher
74 Comments
I will not be surprised by disasterous statistics. I moved to Seoul in March and have been quietly looking out for Galaxy Edge phones everywhere that I go, including metro train. I saw my first Galaxy Edge last week. Here in Seoul. Everyone seems to be buying cheap samsung and LG devices, as well as a significant number of iPhones, including many 6 and 6 Plus. Results will be interesting...
And yet Deutsche Bank claims iPhone growth will underperform in 2016. :rolleyes: http://finance.yahoo.com/news/deutsche-bank-cautions-apple-iphone-122819905.html
They're already giving away tablets to get you to buy them...
how much more do you need to know?
What goes around, comes around. Samsung has alienated those die-hards by (a) making it look so much like an iPhone it isn't funny, and (b) designing in all those things that Samsung fans have so often criticized Apple about, like non-replaceable batteries. Samsung will continue to decline in relevance, which makes me very happy.
The S6 and S6 Edge are pretty enough (well, they are based on Apple designs), but Samsung made the fatal error of pricing them on par with the latest iPhone models. With similar prices, similar physical appearances to the iPhone, non-replaceable batteries and non-extendable storage, like the iPhones, consumers are left to compare and contrast based upon other factors; security, ecosystem, real-world performance, status, etc, Small wonder the Samsung phones aren't selling. Tim Cook must be thrilled that Samsung continues to focus their energies and resources on copying the now insignificant aspects of the iPhone, such as physical form. It shifts the comparison precisely to those aspects that are of most significance in real-world use and where Samsung cannot possibly hope to compete.