Samsung has published its second quarter pre-earnings guidance today. Just like AMD earlier, it has felt "weaker than expected" demand for its money spinning products. In Samsung's case that's due to "tepid demand" for the flagship Galaxy S6 smartphone, reports Reuters.
The most recent quarter results will show estimated sales of 48 trillion Korean won and an estimated profit of about 6.9 trillion Korean won, says an official Samsung statement. That profits figure is four per cent lower than a year earlier and somewhat below the average analyst estimate of 7.2 trillion Korean won. This is Samsung's best profit for a year but doesn't impact upon the overall annual decline.
Several sites report that Samsung simply misread the market. Perhaps it was too cautious as when it launched the Galaxy S6 and premium curved screen Galaxy S6 Edge - as it got the balance of supply wrong. It seems that people were happy to pay the extra for the eye catching curved screen version but Samsung wasn't geared up to make them fast enough to meet demand. ZDNet reports that Samsung went ahead with the expectation that "the regular S6 would outsell the Edge 4 to 1". However demand for the two differently priced phones has been roughly equal.
Now Samsung says it is up to speed with the production of its curved screen flagship but might have simply missed the chance to capitalise upon the launch sensation. People have moved on, and are waiting for another next big thing. There's already a flurry of news about the Apple iPhone 6S and talk of new upcoming mobiles from the likes of Motorola, Sony, HTC and Microsoft.
Looking at the market in general Samsung is fighting in a tougher market, with the world's biggest smartphone market of China showing evidence of its first volume slip in Q1 this year. The upcoming quarters don't look that hot for Samsung as it will probably have to discount the regular Galaxy S6 while suffering the repeated blows of new smartphone launches from rivals.
