Samsung, the largest maker of consumer electronics, said on Friday that it expected weaker profit and revenue, which analysts attributed to slowing sales of high-end smartphones. This is a trend that also bedevils Apple, its main rival.
Samsung, the No. 1 maker of mobile phones, aims its Galaxy models at the top end of the market. While sales of smartphones continue to grow over all, the rate of increase for the more expensive devices has been easing in recent months.
For Samsung, the real problem may be growth in smartphone sales at the lower end of the market, where Chinese manufacturers are gaining share. As smartphones become increasingly commoditized, prices will fall and profit margins will shrink.
Samsung said it expected to post operating profit of $8.3 billion, for the second quarter, a 47 per cent increase from a year earlier. Samsung’s overall estimated revenue grew strongly in the second quarter, rising 20 per cent.
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