Samsung’s operating profit forecast misses expectations

Samsung Electronics says its operating profit is likely to rise 15% in the fourth quarter from a year ago, missing market expectations.

The preliminary figures show that operating profit will be 6.1tn won ($5.1bn; £3.5bn) for the October to December period, from 5.29tn won a year earlier.

Analysts had expected the amount to be 6.6tn won, fuelling growth concerns.

Samsung products have been hit by weak demand in China and currency woes.

Operating profit fell 7.5% from the previous quarter.

Sales at the world’s biggest maker of memory chips and smartphones also missed forecasts at 53tn won for the period.

Samsung does not break down its earnings results in the preliminary report, leaving analysts to speculate on how each business division is doing.

But analysts predict that the latest forecast is a sign that the tech giant will face another tough year of weaker gadget sales as the smartphone market is saturated.

Samsung is facing stiff competition at the top end of the market from Apple, while cheaper Chinese rivals are gaining ground in the mid to low level range for mobile devices.

On Monday, chief executive Kwon Oh-hyun had warned that the firm faced challenges on weak global economic growth prospects.

Final earnings results for the quarter are due to be released at the end of January.


Source: bbc