Samsung expected to see smallest profits yet

Samsung expected to see smallest profits yet

Samsung shares fell 2 percent as the guidance gave investors insight into how badly the decline in smartphone profitability is hurting the company's bottom line, after it warned in April of an earnings slowdown amid tougher competition.

The smartphone market has been slowing down in recent quarters.

Analysts expect an operating profit of $13.3 billion for the quarter, up 5.7 per cent from a year earlier but less than the record 15.6 trillion won it posted in the March quarter, according to a Thomson Reuters poll.

"It is going to be tough". This may mean that Samsung isn't too anxious about the low sales of this year's S9 models.

The Samsung Galaxy Note 9 will be announced on August 9 at the next Unpacked event.

Bloomberg notes that Samsung's OLED sales to Apple for its iPhone X have also been weaker than expected, despite Apple having flogged 52.2 million phones in the second quarter. It will disclose detailed results in late July. The report states that the wide-angle lens will not come with autofocus or OIS.

While Samsung's vague statement fails to show performance and profit estimates for each business division, reports claim the firm's smartphone division, in particular its flagship Galaxy S9 and S9+ smartphones, are to blame for the slowdown.

The high cost of chips has hurt many electronics makers, with Chinese manufacturers among the hardest hit as they operate at lower margins than rivals.