Samsung’s Q2 profits slide 4% year-over-year thanks to faltering Samsung Galaxy S6 sales


Samsung logo DSC08657

HTC isn’t the only company looking at a not-so-happy quarter. Samsung also has issues of their own, but their Q2 2015 performance still didn’t lose them any money. The company reported guidance numbers of $44 billion in revenue and $5.63 billion in profit.

Those numbers were a decent improvement over last quarter, but they missed analyst expectations of $53 billion in revenue and profits are down 4% compared to the same quarter a year ago. Much of the blame for the misstep is being placed squarely on Samsung’s mobile arm.

Samsung Galaxy S6 DSC09362

The general feeling inside the South Korean company is that the Samsung Galaxy S6 didn’t perform as well as expected. It’s not because the smartphone isn’t popular, though — it’s because more people wanted the Edge variant and Samsung didn’t properly gauge demand. That left them with a situation where they didn’t have enough Edge units to sell and a large surplus of base Galaxy S6 units sitting around.

The Wall Street Journal reports that Samsung has since adjusted their production schedule from a 4:1 ratio of Galaxy S6 to S6 Edge units, to nearly 1:1. That’s a huge swing, and Samsung has to hope that demand for the S6 Edge is still there in the months ahead.

It’ll be much tougher to convince consumers now that the big competition on the year is starting to arrive. Both HTC and LG’s flagships are in-store and eating up a good chunk of shelf space, and it shan’t be long before Motorola and Apple’s 2015 wares arrive.

All that aside, it’s not like Samsung Electronics isn’t doing good. They totally are. In fact, one analyst expects their 2nd half performance will put them at a full year earnings increase of 51% thanks to strong showings in their semiconductor arm and a better handle on inventory control for handsets.

But the bottom line is that mobile is not doing nearly as well as it could be, and that can’t be good news for a division that is under fire and at risk of becoming more of a liability than a lifeline.

[via Samsung, CNBC]

Quentyn Kennemer
The "Google Phone" sounded too awesome to pass up, so I bought a G1. The rest is history. And yes, I know my name isn't Wilson.

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