Samsung issues better-than-expected profit forecast

This article discusses Samsung’s profit estimate for the third quarter, which was more optimistic than the expected forecast. It seems that the ‘better-than-expected profit forecast’ was mainly derived from its handset business, which worked to reduce the losses caused by the falling demand for Samsung TV’s and computer chips. This was supported by another firm, ING investments, shown in the statement ‘Its telecommunications business is seen very positive as shipments of smartphones and other high-end handsets expanded’, by Park Jong Min, of ING investment management. Other than its handset business, Samsung is also the second largest mobile phone producer in the world according to the article. The sales of its Samsung Galaxy II crossed the 10 million mark.

The article also includes some of the risks of Samsung’s optimism. I agree with the article that Samsung’s sales will be heavily affected by the ‘slowdown in the US coupled with the ongoing debt crisis in Europe’ and the possibility of the relatively weak Korean currency causing an inflation. However, the weaker Korean currency can also work to Samsung’s advantage, since this makes its products cheaper to foreign consumers.