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Investors: Oh Samsung. You need to smash those records HARDER
Quarterly forecast misses expectations
Samsung's estimates for its second quarter earnings missed forecasts, worrying investors despite the fact that it will be another record-breaking quarter at the firm.
The Korean chaebol said that it expected operating profit of between 9.3tn South Korean won (£5.4bn) and 9.7tn won (£5.6bn), up eight per cent on the previous quarter and nearly half as much again as the previous year.
But the high earnings still weren't as lofty as analysts surveyed by Bloomberg had wanted to see. The number-crunchers had hoped to see the Korean tech overlords predicting operating profits of 10tn won (£5.8bn)
Samsung has seen its shares drop 15 per cent since early last month as analysts and brokerages worry about how many new Galaxy S4 mobes the company is selling. Smartphones make up 70 per cent of the giant firm's profits and these concerns have knocked a whopping $29bn off the firm's market value.
As well as worrying about Sammy's top-of-the-range phones, market watchers are also concerned that low-cost mobes from Chinese rivals like Huawei are eating into the firm's bottom line. Unlike its main rival Apple, Samsung has a range of devices, including budget models.
Apple has also seen its stocks fall, losing 40 per cent since their peak last September. Both firms' spectacular growth has ended up working against them as investors became accustomed to them smashing growth records, and became cautious when growth slowed from the incredible to the merely awesome.
Although Samsung relies on smartphones heavily, analysts are expecting the firm to see a small jump in its chip business later this year after producers held back on supply to try to combat falling memory prices. ®