Samsung expects first profit decline in three years
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Today, October 7, the South Korean corporation Samsung Electronics published preliminary data on revenue and profit of the company in the third quarter of this year. Its three-month operating income is forecast to be 10.8 trillion won ($7.7 billion), down 32% from last year. This will be the company’s first profit cut in three years. Preliminary earnings data were noticeably worse than analysts’ forecasts, which on average had expected this figure to be 12.1 trillion won.
Worse than analysts’ forecasts was also a preliminary estimate of Samsung’s revenue – 76 trillion won ($54.2 billion). Compared to last year, this figure increased by 2.7%. As noted Bloomberg, the decrease in Samsung’s revenue is due to the saturation of the microchip market after almost three years of increased demand for them. Data centers and consumer electronics makers have been cutting orders significantly recently as their warehouses are already full and demand for personal computers and smartphones hasn’t been as strong as manufacturers had hoped.
Samsung will present the full financial report with the final results on October 27th.
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