Samsung delivers warning for tech sector as it predicts fourth quarter profits will miss expectations

Forecast: Samsung thinks its fourth-quarter operating profit will be up 15%

Lee Jin-man/AP

8 January 2016

Samsung has provided the latest red flag for the tech sector after it said it would miss fourth quarter profit expectations with a 15% rise in operating profit.

In a brief statement the electronics giant said operating profit between October and December would likely be 6.1 trillion won (£3 billion), compared to an analyst forecast compiled by Thomson Reuters of 6.6 trillion won.

Samsung added that fourth-quarter revenue was likely to be up 0.5% at 53 trillion won.

The statement comes after Apple shares were rocked this week by a report that it was preparing to cut production of its iPhones by 30% as inventories piled up at retail outlets around the world.

That added to concerns about demand for such devices in 2016.

A report by Accenture released earlier this week showed that 48% of the 28,000 consumers it polled planned to by a smartphone this year, down six percentage points on last year.

“The slowdown in the consumer technology market is irrefutable, serious and global,” Sami Luukkonen, global managing director for Accenture’s Electronics and High Tech group, said in the report.

“The market is not about the glitzy gadgets anymore – rather, it’s about providing secure, innovative and practical digital services and more open collaboration.”

Samsung delivers warning for tech sector as it predicts fourth quarter profits will miss expectations

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