Even if companies like Samsung dominate the global smartphone market, it doesn’t mean that its all smooth sailing for them. In order to please shareholders and investors, these companies strive to post positive quarterly fiscal results, but that’s not always possible. Samsung has announced that its 4Q 2013 operating profit is down 6 percent year-over-year as smartphone sales slowed down in developed countries.
In its earnings preview, the company estimates that it will have raked in an operating profit of 8.3 trillion won or $7.8 billion in the last three months of 2013, thus falling under analysts’ expectations and also registering an 18 percent drop as compared to the previous quarter. According to analysts, higher marketing costs have been eating into Samsung’s operating costs as it tries to ramp up demand for its products in established markets. Samsung is actually believed to spend the most on marketing, well into the billions. The company did not go into much detail in the earnings preview, but it will paint a much more broader picture about earnings as well as net profit later this month. In the new year, Samsung is expected to focus more on tablets as well as low-end smartphones. Apparently it expects to sell as many as 330 million smartphones in 2014.
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