Samsung sees 60% profit drop on component woes - Mobile World Live

Samsung sees 60% profit drop on component woes

05 APR 2019

Samsung announced its anticipated weak guidance for the first quarter of 2019, having previously warned of problems in some of its component units.

The company is guiding for an operating profit of KRW6.1 trillion ($5.4 billion) to KRW6.3 trillion, on sales of KRW51 trillion to KRW53 trillion. In comparison, in the first quarter of 2018 the company reported an operating profit of KRW15.64 trillion, on revenue of KRW60.56 trillion.

While the company had already pointed to weak numbers for the period, the figures – which Financial Times said will see the lowest operating profit for more than two years – were still worse than some analysts had expected.

Late last month, the South Korean giant noted “worse than expected business conditions” in the display and memory segments.

In displays, LCD panels were hit by weak seasonality and price declines due to increased competition from Chinese companies, while profitability in OLED screens fell due to decrease in demand for flexible panels from large customers and intense price competition with LTPS LCD alternatives.

And for memory, price declines are expected to exceed previous expectations, amid overall weak seasonal demand.

So far there has been little guidance on the progress of Samsung’s Galaxy S10 series flagship devices, which were an important launch for the company toward the end of Q1.

From a marketing perspective, Galaxy S10 5G is also doing important work for the company in being the device of choice for South Korea’s 5G network launches, placing Samsung at the head of the pack.

The company is also set to lead the foldable pack with its Galaxy Fold smartphone, in the face of tough competition from its closest rival – Huawei.



Steve Costello

Steve works across all of Mobile World Live’s channels and played a lead role in the launch and ongoing success of our apps and devices services. He has been a journalist...More

Read more