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After four quarters of record earnings, it looks like things will change for Samsung. The South Korean technology giant has released its earnings forecast of 14.8 trillion South Korean won ($ 13.2 billion) of 58 trillion won (51.8 billion) of revenue in the second quarter of 2018. Samsung will release the final results of the second quarter this month.
Although the forecasts show an 11% increase in earnings over the year, they also show a 0.7% decrease in total sales for the period ending June 30th. Forecasts are far from forecasts of 60.3 trillion won Industry analysts believe that lower-than-expected figures for the second quarter can be attributed to weak sales of the Samsung Galaxy S9 as well the price volatility of memory chips.
According to Lee Seung -woo of Eugene Investments, sales of the Galaxy S9 were sluggish. It expects the Samsung to ship about 31 million Galaxy S9 phones in 2018. This figure falls well short of the sales target of 43 million Galaxy S9 phones.
In addition to slow sales for the Galaxy S9, analysts said the chips could wreak havoc on Samsung's gains for the second quarter. Samsung Electronics became the world's leading semiconductor supplier in 2017 and its memory chip sales continue to outperform its long-term competitors. However, prices of NAND memories have fallen in recent months and analysts estimate that DRAM chips will fall by 10 to 15% in the coming months.
Slow sales and components may not be Samsung's only challenges. Earlier in 2018, it was believed that the majority of Apple's future 2018 iPhone models would use Samsung's OLED displays. However, analysts now believe that a greater proportion of upcoming handsets will have cheaper LCDs.
Samsung could see an increase in sales in the fourth quarter, however. The company is expected to announce new equipment in August, including the Galaxy Note 9, the Samsung Gear S4 and the Samsung Galaxy Tab S4. The products would likely go on sale at the end of the third quarter in time for the holiday season.
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