Samsung warns investors to expect below par 2019 first quarter earnings

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In an unprecedented move, Samsung has issued a warning ahead of its earnings guidance for the first quarter of 2019.

It’s the first time that the South Korean firm has done so, normally releasing an earnings guidance a couple of days ahead of the fully fledged quarterly report.

According to Reuters, Samsung has taken this step in a bid to best prepare its investors for a below par quarterly performance. As for why its Q1 2019 is falling short of expectations, the publication notes that plummeting chip prices are the reason. Added to this is a slowing demand in both chips and display panels.

“The company expects the scope of price declines in main memory chip products to be larger than expected,” explained Samsung in a regulatory filing.

As such, it appears as if Samsung is taking a greater hit than anticipated thanks to a weakening demand for smartphones across the global market, and consequently a decline in its own silicon and displays.

The South Korean company is forecasted to post an earnings of 7.2 trillion won, according to Refinitiv SmartEstimate for the period of January to March of 2019, which could be more than 50 percent 15.6 trillion won that they mustered during the same period last year.

While the official quarterly report has yet to be released, this upcoming quarter would be the second in a row where Samsung performed below par. During Q4 2018 the company already cited a stagnating smartphone market as a reason for its middling numbers.

This downturn could lead Samsung to look to other innovative technologies in order to stoke consumer interest once again. The firm has already debuted one foldable phone, with others expected later this year, but whether that will be enough to help it bounce back, remains to be seen.

Samsung’s Q1 2019 results are expected to be released next week.

Robin-Leigh Chetty

Robin-Leigh Chetty

When he's not reviewing the latest smartphones, Robin-Leigh is writing about everything tech-related from IoT and smart cities, to 5G and cloud computing. He's also a keen photographer and dabbles in console games.