Samsung Predicts Q4 Profits To Dip

In what some analysts see as a bad omen for the broader mobile industry, Samsung Electronics says it expects fourth-quarter operating profit to fall short of expectations.

In a brief report released on Friday, the South Korean company said quarterly operating profit likely rose by 15% year-over-year. By contrast, the hardware giant enjoyed a gain in operating profits of about 80% in the third quarter of the year.

Causes for the less-than-stellar forecast include a slowing Chinese economy and broader issues with the world economy.  

Worse yet, recent hardware innovations -- like the curved screen of the Galaxy S6 Edge -- have so far failed to boost Samsung’s bottom line.

Seemingly aware of the problem, Samsung recently promoted D.J. Koh -- who by most accounts is a software guy -- as president of its mobile communications business.

Still, some have suggested that Koh is likely to maintain Samsung’s focus on hardware, which makes sense, considering that fact that he was involved in the development of the Galaxy Note 5 and Galaxy S6.



In that respect, company watchers say Koh is virtually indistinguishable from J.K. Shin, the executive previously in charge of Samsung’s handset division.

Samsung’s operating income was roughly $5 billion in the three months ended December -- down slightly year-over-year, according to estimates released by the company on Friday.

The news follows reports earlier in the week that Apple is scaling back on iPhone orders.

The reports didn’t come as a huge surprise to Apple watchers, considering that the company is coming off a sales surge driven by the launch of the iPhone 6S and 6S Plus.

Even if Apple had some fancy new iPhones to sell, in early 2016 -- which it doesn’t -- most consumers wouldn’t be ready for such a speedy upgrade.

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