Friday, October 28, 2016

Samsung's Mobile Profits Down 95% Due to Galaxy Note7 Trouncing

Samsung has Suffered much due to failure of Samsung Galaxy Note 7 battery and the Korean tech giant had to re-collect all of the Note 7 units through out the world. It was reported earlier that the Korean company would have face a loss of 17 Billion Dollar but the official Q3 report of the company shows a much more loss in sales and profit.

Samsung has announced its financial results for the third quarter of 2016, and - as expected - the Galaxy Note7 fiasco has taken a huge toll on the company's profits. The tech giant's mobile division reported an operating profit of KRW 0.10 trillion ($87.8 million), which is down 96% from the same time last year. That's also the lowest figure for the South Korean company in the past eight years.

The company's overall operating profit for the quarter stood at KRW 5.20 trillion ($4.5 billion), down KRW 2.19 trillion from the profit figure reported in Q3 2015. That's lowest for the company in past two years.

As Samsung said in a press release :

" The IM Division posted KRW 22.54 trillion in consolidated revenue and KRW 0.10 trillion in operating profit for the quarter.

The Mobile business saw its earnings decrease significantly QOQ due to the effects of the discontinuation of the Galaxy Note7. However, smartphone shipments remained solid due to continued stable sales of its existing flagship devices, including the Galaxy S7 and S7 edge, and steady growth in the mid-tier Galaxy A and J series.

Looking ahead to the fourth quarter, smartphone and tablet demand is forecast to increase during the year-end peak season.

The company will strive to achieve comparable YOY earnings in the fourth quarter, helped by solid sales of the Galaxy S7 and S7 edge, while maintaining profitability in the mid-to-low end segment through increased shipments of new models.

As for 2017, the company anticipates a turnaround with the launch of new flagship smartphones. Next year will also see expansion of Samsung Pay rollouts and cloud-related services as well as the introduction of artificial intelligence related offerings.

Official Comparison of sales and Profit :

For the fourth quarter, the company is expecting that the the year-end peak season and the popularity of the Galaxy S7 and S7 edge smartphones will help it achieve comparable YOY earnings. "As for 2017, the company anticipates a turnaround with the launch of new flagship smartphones."

The company has also announced to release Galaxy Note 8 and Galaxy S8 and it has also started to give official tiny clues about these devices. source

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