Samsung's CFO says the financial outcome for Q2 is not good, Galaxy S5 and mid-to-low range phones to blame?

Samsung's CFO says the financial outcome for Q2 is not good, Galaxy S5 and mid-to-low range phones to blame?
Samsung's chief financial officer, Lee Sang-hoon, warned the company's investors that the financial situation during the financial Q2 of the year doesn't look “too good”, as profits are expected to go down. As a result, Samsung's stock price fell roughly 2% to $1,296.4 (1,320,000 KRW). Previous forecasts have already caused Samsung's shares to dwindle 8.5% down during the last month, and the CFO's statement added even more fuel to the fire. The reason for this unfortunate financial situation? Well, it seems that the culprit might be no other than the Galaxy S5 flagship and its sales.

Despite the numerous reports that the Samsung Galaxy S5 is selling pretty well both at home and in the US, the fierce competition from the likes of Sony, HTC, and LG has allegedly already undercut the sales of the latest Galaxy, thus decreasing Samsung's income. Additionally, KTB Investment & Securities, a Korean financial institution, blamed the company's expected not-so-great financial outcome mostly on weak demand for its low-end and mid-range devices.

It is predicted that Samsung might report year-over-year drop of its operating profits of roughly 16% and a general decrease of shipments by 12.5% - from 88 million to about 77 million units. These expectations already stray away from initial expert predictions that Samsung will ship more than 90 million units during Q2.

Samsung already experienced a slight loss of global market share during the first quarter of the year. The manufacturer's due to release its financial report for the financial Q2 of 2014 sometime in the beginning of July.

Samsung's CFO says the financial outcome for Q2 is not good, Galaxy S5 and mid-to-low range phones to blame?



source: The Wall Street Journal, Electronista via Pocket-lint

Related phones

Galaxy S5
  • Display 5.1" 1080 x 1920 pixels
  • Camera 16 MP / 2.1 MP front
  • Processor Qualcomm Snapdragon 801, Quad-core, 2500 MHz
  • Storage 32 GB + microSDXC
  • Battery 2800 mAh(21h 3G talk time)

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60 Comments

1. clevername

Posts: 1436; Member since: Jul 11, 2008

Uh oh. Is this the start of a trend?

14. itsdeepak4u2000

Posts: 3718; Member since: Nov 03, 2012

They need to change the design anyhow and somewhat prices too.

25. PhoneArenaUser

Posts: 5498; Member since: Aug 05, 2011

I agree about design but what's wrong with prices?

40. marcski07

Posts: 600; Member since: Apr 25, 2014

prices of mid/low end phone are wrong, and somewhat not attractive too, they like mini-mes of S line, but retarded. there are local brand that are better and good looking and good speced, low/mid phones, like here in Philippines, Cherry Mobile, Myphone, Star Mobile, and some Chinese phones are taking over with their nice features. in my own perspective, samsung focused on competing iPhone, that they forgot the low/mid end phones... Sony and huawei is killing it in here, they have beautiful mid-ranged phones, and LG too, with their L series... and Myphone or what they call "Filipino Phone" one of the affordable android phone you can buy,. you can browse internet, watch YouTube, play games and watch even tv, or listen to radio.. for just $50 :)

52. itsdeepak4u2000

Posts: 3718; Member since: Nov 03, 2012

Now-a-days flagships are bit pricey. This could be one of the reason for blaming S5 sales otherwise nothing is wrong with S5 except design.

55. PhoneArenaUser

Posts: 5498; Member since: Aug 05, 2011

"Now-a-days flagships are bit pricey." Agree they are pricey but talking about Samsung's flagships they has +/- the same price as any other flagship (at least here in Europe).

45. WahyuWisnu

Posts: 1001; Member since: May 29, 2014

I propose samsung to simplified the model line up and use German way of model number (mercedes benz and BMW). Ex. Galaxy S - highest spec Galaxy E - medium spec Galaxy C - Low spec Galaxy A - Lowest spec phone... Galaxy S mini, Galaxy S, Galaxy S maxi (same spec, different screen size) Galaxy E mini, Galaxy E, Galaxy E maxi (same spec, different screen size) Galaxy C mini, Galaxy C, Galaxy C maxi (same spec, different screen size) Galaxy A mini, Galaxy A, Galaxy A maxi (same spec, different screen size)

49. sar44

Posts: 278; Member since: Apr 14, 2014

noobs-haters got their way samsung made isocell, improved amoled, on of best battery life and speed, wateproof. others did nothing, except that the speakers for kids, gimmick qhd, which only harm.

51. sar44

Posts: 278; Member since: Apr 14, 2014

On the contrary worsened, htc removed OIS, Sony made ​​the screen red and distorting oversaturated colors, and worsened the sound in the headphones, LG made ​​qhd and twisted sharpness because of what the image will halo.

66. engineer-1701d unregistered

your the noob here we samsung fans wanted and they even said a new type of finish and look to the phone and it was crap all, just the worst ever, iso nice, amoled ok good battery ok speed +/- water resistant not proof, no wireless charge gimmick hr monitor, no front speakers big hurt because the s5 speakers loud but sucks. i wont leave my gs3 untill better look and spec my gs3 has 2 gb ram so does the 5 the note has 3gb ram

64. engineer-1701d unregistered

its whats we all told them when they annouced this crap no one will buy it. a stupid heart rate monitor and no real tech updates and ugly as hell.

82. corporateJP

Posts: 2458; Member since: Nov 28, 2009

This is what happens when you flood the market with garbage, you lose that brand luster. Try a Galaxy Ace or Centurion, let me know how that works out for you...

86. Ashoaib

Posts: 3243; Member since: Nov 15, 2013

their ugly design is killing them... beastly spec'd enclosed in unattrative shell... there are many customers who never bother to understand the specs, they just look at the design and become fan. For example, why such a low spec'd apple is so popular? bcoz apple know most products are sold on its percieved value not on real value... so apple always try to bring something which appeal to our eyes, bcoz we can see better than what we can read... once we become fan then we create self justification by ourself to justify our choice... this is what keeping apple's customers and business intact... seeing is believing... beside that mid range and low range of samsung are not decently spec'd like chinese competitors... I have seen the price of samsung's mid end and low end are so high that you can find something else decently spec'd in same price

2. express77 unregistered

Their flagships are great but their mid/low rangers are crap nowadays. And also the design.

9. hipnotika

Posts: 353; Member since: Mar 06, 2013

galaxy s5's design is more ugly than mid/low devices

34. marcski07

Posts: 600; Member since: Apr 25, 2014

you're wrong because they are all the same!!!! same! same! same! that's why they find samsung boring!

10. ryq24

Posts: 872; Member since: Oct 17, 2011

Totally agree. Lg sony and htc have better specs in their mid range phone than samsung.

39. express77 unregistered

*ranges*

3. timukh

Posts: 295; Member since: Feb 04, 2013

In my country at the time of launch s5 was priced at $833. Now it is selling at $600...!! The price cut was due to low sales. But samsung officials said it wasnt true. Well now i guess that it was actually true..

4. nokia12

Posts: 610; Member since: Nov 19, 2013

let me guess you are from india ? :D

37. DocOc

Posts: 143; Member since: Apr 23, 2014

Why would anyone pay $833 for a freakin phone??? I can get a 60 in flat screen TV for $600!!

47. marcski07

Posts: 600; Member since: Apr 25, 2014

WOW, 60 INCH FLAT SCREEN? FOR $600, what country where you from?in my country 60inch flat screen tv costs $1000+

68. engineer-1701d unregistered

my 55 inch tv cost $2400

67. engineer-1701d unregistered

a bad tv for that walmart tvs,

5. chocowii

Posts: 478; Member since: Jan 30, 2014

Youre on the top, only one place to go is to go down.

6. darkkjedii

Posts: 30672; Member since: Feb 05, 2011

Simply put, just as with apple and the iPhone, it's time for Samsung to revamp the galaxy. Absolute great device line, but the looks are bland, although pretty, and the features are nice but not a huge leap. Not much of a jump, between s4 to s5. Apple and Samsung are in very good shape, but we all know, both could blow the kid off, if the really wanted too.

16. StraightEdgeNexus

Posts: 3689; Member since: Feb 14, 2014

Agreed. They make S devices to compete with iPhones, so they must make their designs attractive. Also the touchwiz ugliness and bloat vs. iOS elegance and smooth performance should be solved. +1

21. darkkjedii

Posts: 30672; Member since: Feb 05, 2011

I think the s6, and note 5 will change quite a bit. +1 back atcha

69. engineer-1701d unregistered

its called android stock hahahaha i like my touchwiz but i like tizen look better make touchwiz look like tizen/android L

22. darkkjedii

Posts: 30672; Member since: Feb 05, 2011

Oops lid, and to.

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