Tuesday, September 27, 2016

Samsung Electronics’ Q4 earnings likely to recover

Despite the recent global recall of the Galaxy Note 7 smartphones, Samsung Electronics' earnings are likely to recover in the fourth quarter, industry analysts said on Sept. 27.

A survey by financial information provider FnGuide showed that Samsung is expected to post an operating profit of 7.67 trillion won (US$6.89 billion) for the third quarter of this year, a fall of 5.3 percent from a pre-recall forecast. Before Samsung announced the global recall of the Note 7s earlier this month, the average consensus for Samsung’s third-quarter operating profit was 8.1 trillion won.

The survey showed that Samsung is expected to post a third-quarter net profit of 5.8 trillion won, compared with 6.2 trillion won surveyed before the recall.

But some analysts expected Samsung’s profits to rebound in the fourth quarter.

Kwon Sung-ryul, an analyst with Dongbu Securities, said the recall is painful for Samsung, but the company is likely to report a rebound in fourth-quarter profits, helped by strong sales of semiconductors.

Samsung started selling the Note 7 in South Korea on Aug. 19, but halted sales and conducted a global recall of 2.5 million units earlier this month following reports of some of the devices catching fire while being charged.

Analysts expected the recall to cost about 1 trillion won.

On Sept. 25, Samsung announced that it was postponing the start of new Galaxy Note 7 smartphone sales in South Korea by three days.

The delay came after Samsung is seeking to swiftly complete the ongoing recall in South Korea.
http://www.koreaherald.com/view.php?ud=20160927000543

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