Samsung has been known to be a very strong smartphone brand in these few years. This year though Samsung’s profit numbers are suffering while competition comes in every angle. The current market condition does not help much either. With that being said Samsung just very recently released their profit forecast for the third quarter of year 2014. It is still sitting in more than other manufacturers but it is still disturbing. They have estimated a profit number of about 4.1 trillion Korean Won which is about Rm12.5 billion. Still looks good but it is not as good as last year’s third quarter. In fact the profit forecast shows a decrease of 60% in profits year-on-year. Quarterly as well it is not doing well. Quarter-on-quarter it is actually a decline of 43%. The mobile division actually explains that the loss was due to the lower margins from operations due to increased expenses in marketing while average selling price for devices drop. With increased expense it is no wonder Samsung expects to post drops in profit even though sales numbers improved. It is worrying though that Samsung has not announced any action plans for the recovery even when they are expecting the dip in profits. We are expecting the full numbers to come in by the end of the month and there should not be much change or difference from the forecast. It will be interesting to see how Samsung will respond to this drop in profits though.
Sources: Android Authority