Seoul: Samsung Electronics Co Ltd expects its earnings for the second quarter to be "not that good", a senior company executive said on Wednesday, amid growing worries about weak sales for its key smartphone business.
Lee Sang-hoon, chief financial officer for the world`s largest smartphone maker, made the remark to local reporters. A Samsung spokeswoman confirmed the comment and said the executive did not elaborate further.
Analysts have recently raised concerns that the company`s cash cow handset business will disappoint amid intensifying competition and slowing smartphone market growth. The firm`s shares closed down 1.9 percent on Wednesday, reflecting the pessimism.
"Chinese carriers` inventory adjustment of mid-to-low tier 3G phones and weak Galaxy S5 sell-through will likely limit second quarter smartphone shipments to 78.2 million units," Shinhan Investment said in a report, tipping a April-June quarter operating profit of 8.09 trillion won ($7.95 billion) compared with a 9.53 trillion won profit in the second quarter of 2013.
For the April-June period of this year, average forecast from 39 analysts surveyed by Thomson I/B/E/S tips the firm to report a 8.58 trillion won profit -- in line with a 8.5 trillion won profit reported for the January-March period.
StarMine`s SmartEstimate, which gives greater weighting to the more accurate analysts, suggests further downside risk with a forecast for 8.05 trillion won profit for the second quarter.
Samsung is expected to give its earnings guidance for the second quarter in early July.
