Thursday, July 4, 2013

Samsung announces record profit estimates, money men say 'is that it?'

Samsung announces record profit estimates, money men say 'is that it?'

Only $8 billion profit in three months? How disappointing...

Once upon a time, it may have been enough for a tech company to announce record estimated quarterly profits of $8.33 billion (UK£5.54, AUD$9.10) without financial types predicting doom and gloom.

Well, that's what Samsung has just done for the three month period spanning April, May and June, and all the money men can talk about is how the company's smartphone sales momentum is slowing, not growing.

The figure, perhaps jolted by the launch of the Galaxy S4, is a significant rise on the $6.4 billion (UK£4.3, AUD$6.99) the Koreans added to the coffers in the first three months of the year.

Compared to Q2 of 2012, one year ago, the company stashed $5.86 billion (UK£3.90, AUD$6.40), so the trend is very much in Samsung's favour.

Worse than expected, huh?

However, as Apple found out earlier this year, if you don't grow as fast as those who decide these things (in our experience they're about as accurate as weathermen) then you should be disappointed with yourself.

Indeed, according to one analyst the slowdown, which will become official when Samsung posts its real financial results on July 26, is actually "worse than expected."

Lee Sei-chul, an analyst at Meritz Securities, told Reuters: "The slowdown in its handset business appears to be worse than expected and the disappointing result simply reindorses the market view that Samsung's smartphone growth momentum is slowing."

"But it's got the component side of the business, which is showing solid improvements, and new handset product lineups for the third quarter, so (overall) earnings are likely to grow again in the current quarter."

Whether Samsung has cause for concern, amid the trend towards cheaper handsets in emerging markets, remains to be seen, but that all sounds a little bit like smashing your GCSE's and getting A* in every subject, only to be told by the school janitor that you're probably not going to do very well in your A-Levels next year.


Source : http://www.techradar.com/news/phone-and-communications/mobile-phones/samsung-announces-record-profit-estimates-money-men-say-is-that-it--1163809

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