Apple isn’t the one smartphone maker steeling itself (and analysts) for disappointing outcomes. Samsung Electronics issued earnings steerage for the ultimate quarter of 2018 as we speak that not solely marks its first quarterly revenue decline in two years, but in addition fell far under analysts’ expectations. The corporate attributed the drop to lower-than-expected demand for its reminiscence chips, which in earlier quarters had helped bolster its earnings even when its smartphone enterprise was lackluster.
Samsung Electronics stated it expects consolidated working revenue of about 10.eight trillion gained ($9.67 billion), a 28.7 p.c drop from the 15.15 trillion gained it recorded in the identical interval a yr in the past, and under the 13.2 trillion gained that analysts polled by Thomson Reuters had predicted. Consolidated gross sales are anticipated to be about 59 trillion gained, a 10.6 p.c lower from 65.98 trillion gained a yr in the past ($52.9 billion). Analysts had estimated gross sales of 62.eight trillion gained.
In an announcement, the corporate stated “we anticipate earnings to stay subdued within the first quarter of 2019 on account of tough circumstances for the reminiscence enterprise,” because of unexpectedly weak demand from a few of its information heart clients.
Final week Samsung rival Apple lowered its first-quarter earnings steerage, as CEO Tim Prepare dinner stated that the corporate now anticipated income of $84 billion, down from its preliminary projection of $89 billion to $93 billion. The corporate blamed sluggish demand in rising markets, however, normally, the smartphone market has been underwhelming over the previous two years.
A few yr in the past, Gartner recorded the primary ever decline for world smartphone gross sales since 2004, when it first started monitoring the market. It attributed the drop to 2 foremost components: fewer function telephone homeowners upgrading to smartphones due to the dearth of high quality “ultra-low-cost” smartphones, and present smartphone homeowners deciding to purchase and preserve high quality units for longer durations of time.