Samsung expects disappointing profits due to slow Galaxy S9 sales

6 Jul 2018

Samsung S9 smartphone. Image: Natee Meepian/Shutterstock

Bumper profit run for Samsung ends due to poorer-than-expected sales of flagship S9 smartphone.

Samsung Electronics has forecast $13.2bn (14.8 trillion won) in operating profits based on $51.8bn (58 trillion won) of revenue for Q2.

This represents a decline of 0.7pc in profits and a 4.9pc fall in revenues.

It signals the end of a stellar profit run for the South Korean electronics giant.

Have another DRAM

The news comes just after Samsung reported its strongest results ever in Q1 with profits of 15.64 trillion won on revenues of 60.56 trillion won. The dip is being attributed to poor sales of the flagship Galaxy S9 smartphone, which launched earlier this year at Mobile World Congress.

The device was billed as Samsung’s most social phone ever with an impressive camera including 720p slow-mo and powerful editing features; an all-metal unibody in a variety of colours; and a super AMOLED screen for both the 5.8in S9 and the 6.2in S9 Plus. It also came with a new feature called AR Emoji, allowing users to create 3D characters of themselves.

Unfortunately, it appears that the company was overtaken by bigger trends in the global tech market.

Globally, demand for smartphones has begun to slow down but Samsung was able to weather the storm in Q1 thanks to demand for its memory chips, especially for DRAM and NAND chips.

However, as well as weakening smartphone sales, the company also is understood to have sold fewer OLED screens to Apple.

Samsung will officially reveal its financial results for the second quarter later this month, including divisional performance.

Samsung Galaxy S9 smartphone. Image: Natee Meepian/Shutterstock

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years

editorial@siliconrepublic.com