Samsung Record Profits
The popularity of the Samsung Galaxy S3 Smartphone has enabled the company to receive record profits, claim analysts. This substantial gain in profits has increased shares by 1.5%. However, even though Samsung has done very well, there is a small doubt on the future profits of the company. This doubt emerged when legal disputes with Apple surfaced. Apple accused Samsung of violating its patents and a California court favoured Apple. This court ruling puts pressure on Samsung’s fourth-quarter earnings depending upon the amount Samsung leaves aside for possible fines regarding the Apple lawsuit.
This loss in court not only means that Samsung owes more than 1 billion dollars in damages to Apple, but this loss could negatively impact Samsung’s image. Once a company is associated with a certain view or image, it can be hard to disassociate itself with that particular view. Once consumers and the general public have a certain view on a company, it is almost an unconscious association with the view and the company; thus, making it very difficult to reverse negative or any association. After losing the lawsuit with Apple, Samsung could be viewed as unoriginal or as an imitator. Even if the violation of Apple patents might not be very severe, the general public may not know that information. Also, loyal Apple customers may avoid buying other Samsung products in attempts to be loyal to Apple.