South Korean giant Samsung Electronics is expecting to see a slight decrease in profit during the first quarter of 2014. Samsung stated on April 8, 2014 that the operating profit was estimated to be 8.4 trillion won, which represents a decrease of 4 percent from 2013. Meanwhile, the company’s sales forecast remains at 53 trillion won.
The company will face a downfall due to unsatisfactory sales of its smartphones, which are expected to bring Samsung 6 trillion won in operating profit. The company managed to sell about 90 million units during the first three months of 2014 and 69 million units during the same period in 2013. A senior analyst at Kiwoom Securities, Kim Sung-in said, “The narrowing profit margin is because its smartphones became higher-end and required costlier parts”.
Despite the current situation, some factors are still working in Samsung’s favor. The semiconductor segment of Samsung noticed a satisfactory performance as the pricing of dynamic random-access memory did not experience any changes from January 2014 until March 2014.
According to experts, special bonus payment and currency fluctuations failed to hurt earnings of the biggest tech companies. The consumer electronics business is likely to pick up with an expected increase in demand for TVs.
Photo Credits: Infochat