Samsung Expecting Sharp Drop in Fourth Quarter Profits

Samsung today said in a regulatory filing that its earnings for the fourth quarter of 2018 have likely dropped sharply due to weak memory chip demand and growing competition in the smartphone business.

As noted by Reuters, Samsung's operating profit for the three months ending in December was at approximately at 10.8 trillion Korean won, aka $9.67 billion, well below the 13.2 trillion won predicted by analysts and a 29 percent drop from the year-ago quarter.


This marks Samsung's first decline in quarterly operating profit in two years, with more detailed information set to be announced during Samsung's earnings in January.

The news about Samsung comes after Apple last week announced that it was lowering its revenue guidance for the first fiscal quarter of 2019, aka the fourth calendar quarter. Apple cited a number of reasons for the guidance downgrade:
  • iPhone XS, XS Max, and XR launch timing compared to iPhone X timing in 2017
  • A strong U.S. dollar
  • Supply constraints on Apple Watch Series 4, iPad Pro, AirPods, and MacBook Air
  • Economic weakness in emerging markets, specifically China
  • Trade tensions with China
  • Lower than anticipated iPhone revenue, primarily in China
  • Weak iPhone upgrade numbers in some developed markets due to fewer carrier subsidies and low-priced battery replacements in 2018
Apple lowered its guidance to $84 billion, down from the $89 to $93 billion guidance that was shared in November. At $84 billion, Apple will see a year-over-year revenue drop in 2019 after pulling in $88.3 billion during the first fiscal quarter of 2018.

Tag: Samsung


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2 weeks ago
Copying Apple again. :cool:
Rating: 25 Votes
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2 weeks ago

as the article points out, much of this is due to Apple's lower demand for iPhones.


Nowhere in the article is anything like that mentioned.
Rating: 14 Votes
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2 weeks ago
this will be fun and interesting to read the comments from those highly critical of Apple and Tim Cook the other week. Let the spin begin.
Rating: 12 Votes
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2 weeks ago

this will be fun and interesting to read the comments from those highly critical of Apple and Tim Cook the other week. Let the spin begin.


I am expecting to hear crickets if even that. It doesn’t fit the narrative the arm chair quarterbacks or CEOs that populate this forum gravitate to. If anything it helps negates the several 400, 500 responsed threads that end up in “I told you so” grandstanding. So I expect mostly silence or “But, but, but Apple....” type of replies.

So much bile and negativity in these Mac forums lately. The iPhone sub forum is good example. The business related topics are consuming that forum. The moderators need push that stuff off more. I am visiting this website’s forums less and less now because it is all about Apple needing to do this or Apple needing to do that. Air your greviences in the right sub forum people. I want to read about hardware and issues, not personal pet peeves with Apple because you think your phone costs too much. Not that I don’t disagree but find the right sub forum or thread to air your greviences. It seems like every thread is about this now.

Sorry, I digress. Yes, let the spin begin :)
Rating: 11 Votes
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2 weeks ago
I guess this is Tim Cook’s fault as well, according to some. Reality is smartphones have hit market saturation and either need to be reinvented or fade away in favor of something better (whatever that is).
Rating: 7 Votes
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2 weeks ago
Let’s see if the tech world and investment analysts lose their **** about this as they did last week regarding Apple. I doubt it.
Rating: 6 Votes
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2 weeks ago
So I guess Samsung is doomed along with Apple, right?

... right?
Rating: 6 Votes
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2 weeks ago
You know, when people say that the high-end market is saturated and that the upgrade cycle is now 2-3 years that only means that growth will slow. Apple still is going to sell like $50bn + of iPhones this FY, which is still a massive number of phones.
Rating: 4 Votes
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2 weeks ago
The emerging sense here is that there is a demand crunch in the Chinese economy. This is likely being caused by a number of factors driving layoffs and reduced hours, which means workers have less money to spend on conspicuous consumption items. In a short-term sense, I think the big factor would be layoffs from Trump's so-called trade war. But the bigger factor is that the global economy simply hasn't been performing, since 2008. We are way too invested in financial markets, and firms like Apple are sitting on way too much cash. In the past, a decline in Chinese domestic demand wouldn't have effected western firms like Apple so much. But it speaks volumes to where we are now, with the impact of globalization on economies.

The big tech firms, like Apple, need a new "big thing." Thing is, it likely won't be a big consumeristic "thing" like the iPhone. Possibly, if government were to lead the way on it, the next big thing would be an industrial revolution in environmental technologies. Apple and other companies might have a lot to contribute, on this front...

Hear me out: So far, we’ve only attempted market-based solutions (cap and trade, consumption taxes, etc) to global warming. We’ve focused on the idea of adding taxes on human activity, with the view that ‘doing less’ human activity is the solution. Of course it won’t work. Human demand for human activity is quite understandably inelastic! No wonder ppl reject it. As the gilets jaunes in France represent, people see that the market-based solutions hit the poor the hardest. The narrative we’ve been afraid to try is: MORE human activity. And that’s the basis of the so-called green new deal. A stimulus-based approach, which has the added virtue of kick-starting a new era of productive jobs in the global economy. Right now, global demand is still weak from 2008. Because we haven’t learned the lessons of 2008, the real money is still in finance. Large corporations are sitting on piles of non-productively invested cash, for lack of demand. Salaries are very low, in real terms, compared to what they were in the 30 years after WWII. The gap between rich and poor has not been as wide as this, since the gilded age — except it’s worse for us. These are the facts. Meanwhile, the effects of global warming are also disproportionately effecting the poor. And so the situation cannot endure. We need a green new deal, which starts with the proposition a whole generation people shouldn’t be abandoned to live paycheck to paycheck, but which furnishes the solution to our globally weak economy with a massive GREEN jobs program.

A green new deal. Like FDR’s new deal, except focused on converting our energy generation and transmission, our transportation, and our waste management, to a carbon neutral basis. Secondly, to begin a serious effort to re-sink atmospheric carbon into the earth; in Iceland they have a system which, if scaled, can use sea water to turn atmospheric carbon into limestone blocks. To do this on a widespread scale however, is the trick. None of this will be achievable without a massive public investment plan, however. Which means it will be costly, and corporations won’t want to do it. What we’ll need to remind ourselves however is that taxes used to be much, much higher, in the new deal era. And much of the global prosperity of the 50s and 60s came from this. From the USA to there UK to Norway to India, demand stimulation came from public-led programs. These reduced inequality, extended lifespans, increased happiness, and also set the basis for the success of future generations. All of this has been unraveling slowly since the 1970s, because of neoliberal technocratic dithering. We’ve lost faith in the idea of collective action. We do everything thru market-based solutions now. Which means, of course, that today we solve only the problems from which short-term profits can be made. I think so long as this short-termism prevails, we are doomed.

The current likely collapsing bubble in tech stocks is symptomatic. We need government to lead the way, with a new deal, if tech jobs are to survive. We need a new, green revolution in demand-side economics.
Rating: 2 Votes
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2 weeks ago

this will be fun and interesting to read the comments from those highly critical of Apple and Tim Cook the other week. Let the spin begin.


If Steve Jobs were still around, Samsung's profits would have increased.
Rating: 2 Votes
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