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Samsung Q2 2018 earnings guidance hints at poor Galaxy S9 sales

It was reported multiple times over the past couple of weeks that Samsung might see a dip in its revenues for the second quarter of this year. That does seem to be the case after looking at the Q2 2018 earnings guidance that the company has released today.

Samsung expects to bring in 58 trillion won or $51.8 billion in revenue for the quarter ending June 30 with an operating profit of 14.8 trillion won or $13.2 billion. The earnings guidance represents a 0.7 percent decline in sales for the company.

Samsung Q2 2018 earnings

Samsung has been posting record profits in every quarter over the past year but it appears that the momentum is slowing down. Q2 2017 was particularly good for the company as it cemented its status as the most profitable tech company in the world. Samsung reported revenue of 61 trillion won or $54.7 billion in the same period last year with an operating profit of 14.7 trillion won or $12.67 billion. It posted an impressive improvement of 72.7 percent compared to Q2 2016.

Analysts had estimated that Samsung would post 14.9 trillion won as operating profit in the second quarter of this year but Samsung itself expects to post 14.8 trillion won or $13.2 billion. Despite the 0.7 percent decline in sales, this represents an 11 percent increase in profit compared to the same period last year.

It’s pertinent to note here that even though Samsung hasn’t sent a new record with its revenues and profits, it earned a record $14.13 billion in Q4 last year, the company expects an 11 percent improvement in profit despite lower sales. This suggests that Samsung has improved its profit margins and made additional cost savings. Moreover, Q2 has historically been challenging for the company.

Many analysts are blaming the decline in sales on the Galaxy S9. There have been countless reports over the past few months that made claims about poor Galaxy S9 sales. Some reports have even said that the Galaxy S9 has sold the lowest of any Samsung flagship since the Galaxy S3 as shipments are expected to barely cross the 30 million unit mark this year.

There will be more clarity on the matter once Samsung releases the full quarterly earnings report later this month. It’s difficult to say at this stage which division has contributed the most to the 11 percent profit increase though with the semiconductor division being the company’s cash cow, it has likely played a major role in that.

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SAMgalaxyXXX
SAMgalaxyXXX

I’ve said it many times before, Samsung should have only released one S9 plus with 6inches and focus all their marketing power on one model while properly supporting the S8 / S8plus.
Also, Samsung needs to understand once and for all that this is not 2013-14 anymore and the mobile market is far more competitive thus it has to lower the price of its phones regardless of what other OEMs are doing. Even Apple will start to reconsider its pricing of the iPhones.

zlatan09
zlatan09

What they expected with S9?

MStuart
MStuart

Samsung has totally lost its identity. If I wanted a flashy, all-about-looks phone I’d buy Apple. I want a decently priced phone with a nice, robust plastic body, IR blaster, removable battery, and sane display and aspect ratio, no stupid distorted curved display, just like in the Note 4 days.

Leave the slippery, feature-less overpriced glass sandwiches to Apple.

Bobbingalong
Bobbingalong

I would see Samsung going bust if they do that.

MStuart
MStuart

Yeah well, as it turns out only Apple is good at being Apple. And by making £1000 glass sandwiches just like Apple, there’s nothing for Samsung to differentiate their phones and only Android die-hards are going to choose those over Apple’s offerings.

Bobbingalong
Bobbingalong

Samsung is the premium for Android OS. I choose this over my iPhone x any day.

Though I would be happy for a metal back and ditch the glass or even wireless charging.

SAMgalaxyXXX
SAMgalaxyXXX

Yeah, Samsung has gone for glossy “cheap” plastic back but more durable to glossy “premium” glass slippery back but fragile. Unfortunately as long as reviewers keep calling this glass sandwich non-sense premium Samsung will continue with this. Only Juan Barnell (used to work for Pocketnow) is calling it as it is, glass back is neither premium nor ideal. Luckily we can sort that out with a case but people than didn’t use to care about cases are now being forced to buy one. I wish my Note 5 and 8 had a nice ruggerised back like BlackBerry Key one or… Read more »

donrojo
donrojo

I used to say this about Motorola/Lenovo: noone is willing to spend 1000usd on a phone that would literally be abandoned after one year. Because, the way Samsung treated S7 flagship this year is a reminder S9 will be treated even worst after S10 comes to the show!

Bobbingalong
Bobbingalong

Haha I told you so with such a disappointing minor upgrade and making the smaller model poorly spec.

Though doubt Samsung planned for a dud year in anticipation for the S10.

I bet 100% the note 9 will even fare worst in sales. They should just scrap it’s release

imart143
imart143

I buyed S9 and i am happy.. i want S8 but skip it due its unusable fp scanner position. S9 is what S8 should be. But people dont see enough differences and stay with S8. I had S7 till now and S9 is great phone to me. Big jump. I had iphone 7 and it is past time. No fast charging, no wireless charging, battery is low capaciy. Display is LCD. I dont hate ios. Just buyed ipad 2018. For tablet, apple is great for me. Best tablets in world and not expensive. Good 10′ tablet with apple A10 chipset,… Read more »