Analysts expect Samsung to report solid profit growth for 2015

Even though the Samsung Galaxy S6 and Samsung Galaxy S6 edge will become the best-selling smartphones in the history of Samsung Mobile, it doesn't seem to be enough to start a buying frenzy in the company's stock. Samsung's shares are down 6% for the year, and tomorrow the company is expected to guide analysts in the right direction for its second quarter earnings report, which will be released at the end of this month.

Based on a survey of 39 analysts, Samsung is expected to report operating profit of $6.4 billion USD for the second fiscal quarter. That is basically the same operating income reported by the manufacturer during last year's April through June period. It is a 20% gain sequentially from this year's Q1. But no one seems impressed; of the 39 analysts surveyed, 20 have cut their forecasts in the last 30 days by an average of 3.9%.


Despite the recent trimming of forecasts by those 20 analysts, most are still looking at 2015 as being a comeback year for Samsung. A survey of analysts covering Samsung reveals that on average, this group expects the manufacturer to score an operating profit of $24.7 billion USD for all of 2015, up from last year's $22.2 billion USD. The 2014 bottom-line represented a three-year low for the company. The second half of this year should be strong with third and fourth quarter operating profits of $6.49 billion USD and $6.66 billion USD respectively.

Samsung missed a golden opportunity to rack up some huge numbers this year by underestimating the demand for the Samsung Galaxy S6 edge. As a result, it did not have the parts on hand to built enough units to meet the strong demand for the model. While the company says it now can build enough Galaxy S6 edge models to meet demand, it soon will be time for Samsung to face the next iteration of the Apple iPhone.

By increasing the size of the iPhone screen to 4.7-inches on the Apple iPhone 6, and offering a 5.5-inch Apple iPhone 6 Plus, the tech titan sold a record 74.5 million iPhones in its first fiscal quarter. Apple thinks it has another weapon to use against Samsung this year with Force Touch. Used on the Apple Watch, the feature allows the screen to differentiate between a heavy tap and a light tap. For example, an iPhone user might press hard on his screen in order to fast forward a YouTube video. A softer tap in the same place could pause the video.

Samsung might have some ammunition of its own with a rumored Samsung Galaxy S6 EDGE+. This is believed to be a larger sized version of the Galaxy S6 edge, powered by the Snapdragon 808 SoC. The chipset features a hexa-core CPU and the Adreno 418 GPU. And of course, the Samsung Galaxy Note 5 should be unveiled at IFA in September. Samsung hopes that both models can take some air out of the unveiling of Apple's new iPhone models.



source: Reuters