First profit drop in three years for Samsung? | RetailDetail

First profit drop in three years for Samsung?

First profit drop in three years for Samsung?

Korean electronics giant Samsung has forecast a 10 % turnover drop and 35 % profit drop for its fourth quarter. This may result in its first full-year profit drop since 2011.

Better than its third quarter

Samsung has managed to limit the damage in its fourth quarter, after a considerable profit drop in its third quarter (-60 %). That is partly thanks to the weak Korean won currency compared to the American dollar and thanks to the moderate success of its Galaxy Note 4. Nevertheless, its numbers are not that positive: Samsung has forecast a 39.1 - 40.6 billion euro turnover, 10 % lower than what it managed in 2013's fourth quarter.


Profits have suffered even more as it dropped from 6.4 billion euro to 3.8 - 4.1 billion euro (-35 %). Its full-year numbers will be presented at the end of January, but it is highly likely that Samsung will have to concede its first profit drop in three years.


Mobile branch struggles

The explanation for the turnover and profit drop is clear: Samsung's smartphones and tablets face huge competition on both sides of the market. The newest iPhone is a threat in the higher echelons and on the lower end of the scale, cheaper brands like Xiaomi are gaining market share. In its third quarter alone, Samsung's mobile division had to deal with a 74 % profit drop. During its peak, the division represented 68 % of the group's profit, which has faded to 44 % in the third quarter.


Samsung hopes to turn the tide at its mobile division with 30 % fewer new smartphones and an increased focus on the development of its other divisions - like the "internet of things" and its television branch.

Questions or comments? Please feel free to contact the editors

Media Saturn launches first checkout-free store in Austria


Saturn has opened Europe’s first checkout-free electronics store in Austria. The former Metro Group chain offers its customers traditional sales assistance, but payments have to happen using an app.

Media Markt unifies its online and offline pricing


Ceconomy will create uniformity between Media Markt and Saturn’s online and offline pricing. This will be possible thanks to the digital price tags it now uses in the stores, because there can be altered in real-time.

Smartphone sales drop for the first time ever


2017 may have been a record year for smartphone sellers, but the market is weakening: for the first time since 2004, there were fewer smartphone sales in the fourth quarter.

Merger paid off for Fnac Darty


French entertainment and electronics retailer Fnac Darty (owner of Belgian chain Vanden Borre and Dutch BCC) has experienced a “solid 2017”, with a nearly 40 % turnover increase.

Ceconomy finds growth online


Ceconomy, Media Markt and Saturn’s parent company, revealed a small turnover growth for its first quarter, thanks to improved online sales. Expectedly, its profit did drop.

Insurance company becomes second largest Fnac-Darty shareholder


There has been yet another thorough shake-up among Fnac Darty’s shareholders. The merger company, which owns Belgian electronics chain Vanden Borre and Dutch retailer BCC, will now welcome insurance company SFAM, after it bought investment fund Knight Vinke’s shares.

Back to top