Wednesday, October 26, 2016

Samsung posts lowest profits in two years as mobile division feels the burn

Samsung posted its Q3 2016 results, and as the company forecast last week, the discontinuation of the Note 7 had a noticeable impact on its bottom line.

Overall revenue was down 7.5% to $42.01 billion (47.82 trillion Won), a decrease of $3.4 billion (3.87 trillion Won) from the same period last year. Operating profit was down by 30% to $4.56 billion (5.20 trillion Won), its lowest in two years.

The mobile division took the biggest hit, posting a profit of just $87.8 million (100 billion Won), a decline of 96% from Q2 2016. Overall revenue for the division was at $19.80 billion (22.54 trillion Won).

Looking forward to the next quarter, Samsung is looking to stabilize sales by focusing on the Galaxy S7 and S7 edge in the high-end segment, the Galaxy A series in the mid-tier category, and the Galaxy J series in the budget segment.

As for next year, Samsung is looking for a turnaround with new flagships, which will include the Galaxy S8 and the Note 8. The South Korean manufacturer will also focus on cloud-related services, and will make Samsung Pay available in more markets. Finally, we'll see the introduction of "artificial intelligence related offerings."



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