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Samsung Reports Major Drop in First-Quarter Profits

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Samsung Reports Major Drop in First-Quarter Profits

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The latest flagships by Samsung Electronics, Galaxy S6 and S6 Edge, were supposed to bring the company back on track. The company has been rapidly losing ground to other smartphone manufacturers like Apple, OnePlus, and Xiaomi. The escalating demand for its flagships speaks of Samsung’s decent performance this time around, but the latest announcement says otherwise.

Samsung, who has been relying on the buoyant sales of the high-end devices, recorded significant slide in profit for the sixth consecutive time. It is the sixth consecutive quarter-on-quarter (QOQ) drop reported by Samsung. The company today declared that Q1 2015 net profit was 4.63 trillion won ($4.35 billion). This was lower than the 7.49 trillion won gained the previous year. The company also mentioned that the quarterly revenue tripped by 11 percent to 47.12 trillion won, while the operating profit increased to 5.98 trillion won.

The latest statistics is higher than the previous quarter and less than half of what was reported in Q1 2014.

Samsung Galaxy S6 and S6 Edge 0

Samsung is banking on the Galaxy S6 and S6 Edge to help boost its numbers.

Samsung’s latest S series was outdone by Apple’s iPhone 6 and its bigger sibling. According to numbers, people preferred the bigger iPhones over the curvy Galaxy S6 Edge. Alongside, Samsung has been unable to cope up with the supply demands of Samsung S6 Edge, which is likely to have an adverse effect on its business.

Apple has again become the world’s most valuable company and disclosed the iPhones sales of the first quarter. According to Apple, a total of 61 million iPhones were retailed in Q1 this year and the maximum numbers were sold in China.

Samsung expects a better sales figure in the second quarter, and said that the Galaxy S6 and S6 Edge will boost the numbers up in the next couple of months. OLED and LCD panel sales are further anticipated to lift the overall sales. The Consumer Electronics (CE) Division also sees an improved sale of air conditioners and the flagship SUHD TV.

With many premium products in its kitty, Samsung expects to recover its revenue figures in the next quarter. However, it wouldn’t be that easy as many tech start-ups, as well as established companies, have secured a niche in almost every segment. Xiaomi has become a customer favourite and Apple fans are rapidly multiplying all over the world. It would be interesting to see what tactics Samsung adopts to catch up with these present titans.

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About The Author
Meenakshi Rawat
Meenakshi Rawat
iGyaan's newbie Meenakshi handles content at iGyaan. She is an ultimate foodie, loves travelling and likes to read.
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