Samsung predicts lower earnings

Story highlights

  • Analysts say Samsung's handset sales are helping weaknesses
  • Experts also say the strengthening US dollar against the Korean won helps exports
Samsung Electronics said Friday it is expecting weaker third quarter sales as demand for flat screen televisions and computer chips falls.
The South Korean technology giant forecasts an operating profit of 3.75 trillion won ($3.5 billion), down 13% from a year earlier. Profits are expected to rise though from the previous quarter by 12%.
Analysts say Samsung's handset sales are helping weaknesses in other businesses.
"Semi conductors are still strong and even if they don't make as much profit, it's not because they're less competitive, it's because the semiconductor market as a whole went down. As for smart phones, they are becoming comparable with Apple, they haven't surpassed Apple yet but they are catching up very fast," Lee Sun Tae of Meritz Securities in Seoul said.
Experts also say the strengthening US dollar against the Korean won helps exports and the bottom line. Lee estimates a small increase in the dollar's strength of less than one cent could result in an extra $250,000 profit for Samsung. Lee believes the US dollar will continue to gain strength for the rest of this year.