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Samsung set to fall short of Q2 targets

It seems that Samsung is still struggling for success in the smartphone market, at least by its own lofty standards.

According to its latest earnings guidance report, the South Korean firm will fall short of its Q2 targets, with operating profit and sales expected to fall when compared to the same period twelve months ago.

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The news is sure to come as a blow for Samsung and its investors, particularly given the strong reviews for its new flagship Galaxy S6 and S6 Edge smartphones. However, it appears that critical praise has not resulted in high enough sales figures, with supply issues for the S6 Edge, in particular, slowing distribution.

As a result, operating profit is predicted to hit 6.9 trillion won (£3.5 billion), down on the 7.3 trillion won (£4.15 billion) that analysts initially expected. Consolidated sales on all products also declined from 52.4 trillion won in 2014, to 47 trillion this year.

Samsung has endured a difficult time recently following less than stellar sales figures of its Galaxy S5 handset. It has also seen its profit margins squeezed at the top end by Apple’s iPhone and at the bottom by budget Chinese manufacturers. However, it hoped that by offering a more premium smartphone, in the form of the S6, sales figures would pick up.

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Although the recent earnings guidance report suggests this has not met expectations, rectifying supply issues could see finances improve for Q3. In more positive news for the company, Samsung is reportedly supplying computer chips and other components for Apple’s next iPhone release. If true, it would mark a thawing in relations between the two companies which have often contested fierce legal battles.

Barclay has been writing about technology for a decade, starting out as a freelancer with IT Pro Portal covering everything from London’s start-up scene to comparisons of the best cloud storage services.  After that, he spent some time as the managing editor of an online outlet focusing on cloud computing, furthering his interest in virtualization, Big Data, and the Internet of Things.