Samsung Q1 posts profit drop of 39pc on Q1 2014

29 Apr 2015

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Much will be resting on Samsung’s new S6 flagship phone given its latest Q1 2015 financial report shows that profits have fallen by as much as 39pc.

Between January and March this year, Samsung made a net profit of 4.63trn Korean won (KRW) (€4bn), which falls well short of the same total it made last year which was KRW7.49trn.

According to the Associated Press (AP), this was just short of market analysts’ estimates, which had predicted a total profit by Samsung of KRW4.97trn.

Samsung’s mobile division and its, until now, flagship Galaxy range, took the biggest hit in the company’s sales, making just KRW2.74trn in Q1 this year compared with KRW6.43trn during the same time last year.

Overall though, the company’s sales dropped by 12pc to KRW47.12trn compared with Q1 2014 and its operating income fell by 30pc to KRW5.98trn.

Despite its major shortcoming compared with Apple, which posted record profits of US$13.6bn in its Q2 report, analysts believe that Samsung sold more phones than Apple worldwide, but unsurprisingly Apple outsold the South Korean company significantly when it came to the high-end market phones given last year’s launch of the iPhone 6 and iPhone 6 Plus.

Samsung’s TV products posted heavy losses of KRW140bn for the quarter; it is one of the company’s least profitable parts of the business.

Samsung’s best performer for the quarter proved to be its component division, which provides hardware for mobile phones.

Much will now be resting on the performance of the company’s new flagship phones, the Samsung S6 and S6 Edge, which went on sale earlier this month.

Samsung store image via Shutterstock

 

Colm Gorey is a journalist with Siliconrepublic.com

editorial@siliconrepublic.com